Correlation Between PetroChina and Tengda Construction
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By analyzing existing cross correlation between PetroChina Co Ltd and Tengda Construction Group, you can compare the effects of market volatilities on PetroChina and Tengda 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 Tengda Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Tengda Construction.
Diversification Opportunities for PetroChina and Tengda Construction
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between PetroChina and Tengda is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Tengda Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tengda 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 Tengda Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tengda Construction has no effect on the direction of PetroChina i.e., PetroChina and Tengda Construction go up and down completely randomly.
Pair Corralation between PetroChina and Tengda Construction
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 1.16 times more return on investment than Tengda Construction. However, PetroChina is 1.16 times more volatile than Tengda Construction Group. It trades about 0.07 of its potential returns per unit of risk. Tengda Construction Group is currently generating about 0.01 per unit of risk. If you would invest 486.00 in PetroChina Co Ltd on September 12, 2024 and sell it today you would earn a total of 350.00 from holding PetroChina Co Ltd or generate 72.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Tengda Construction Group
Performance |
| Timeline |
| PetroChina |
| Tengda Construction |
PetroChina and Tengda Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Tengda Construction
The main advantage of trading using opposite PetroChina and Tengda Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Tengda 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 Tengda Construction will offset losses from the drop in Tengda Construction's long position.| PetroChina vs. Digital China Information | PetroChina vs. DO Home Collection | PetroChina vs. Tongding Interconnection Information | PetroChina vs. Guangzhou Dongfang Hotel |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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