Correlation Between PetroChina and Shanghai Construction
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By analyzing existing cross correlation between PetroChina Co Ltd and Shanghai Construction Group, you can compare the effects of market volatilities on PetroChina and Shanghai Construction and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PetroChina with a short position of Shanghai Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Shanghai Construction.
Diversification Opportunities for PetroChina and Shanghai Construction
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between PetroChina and Shanghai is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Shanghai Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Construction and PetroChina is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PetroChina Co Ltd are associated (or correlated) with Shanghai Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Construction has no effect on the direction of PetroChina i.e., PetroChina and Shanghai Construction go up and down completely randomly.
Pair Corralation between PetroChina and Shanghai Construction
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 1.23 times more return on investment than Shanghai Construction. However, PetroChina is 1.23 times more volatile than Shanghai Construction Group. It trades about 0.07 of its potential returns per unit of risk. Shanghai Construction Group is currently generating about 0.0 per unit of risk. If you would invest 506.00 in PetroChina Co Ltd on October 14, 2024 and sell it today you would earn a total of 369.00 from holding PetroChina Co Ltd or generate 72.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Shanghai Construction Group
Performance |
| Timeline |
| PetroChina |
| Shanghai Construction |
PetroChina and Shanghai Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Shanghai Construction
The main advantage of trading using opposite PetroChina and Shanghai Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Shanghai Construction can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Shanghai Construction will offset losses from the drop in Shanghai Construction's long position.| PetroChina vs. Shannon Semiconductor Technology | PetroChina vs. Qingdao Haier Biomedical | PetroChina vs. Shanghai V Test Semiconductor | PetroChina vs. Zhonghong Pulin Medical |
| Shanghai Construction vs. Agricultural Bank of | Shanghai Construction vs. Industrial and Commercial | Shanghai Construction vs. Bank of China | Shanghai Construction vs. PetroChina Co Ltd |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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