Correlation Between PetroChina and Inspur Software
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By analyzing existing cross correlation between PetroChina Co Ltd and Inspur Software Co, you can compare the effects of market volatilities on PetroChina and Inspur Software 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 Inspur Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Inspur Software.
Diversification Opportunities for PetroChina and Inspur Software
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PetroChina and Inspur is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Inspur Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspur Software 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 Inspur Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspur Software has no effect on the direction of PetroChina i.e., PetroChina and Inspur Software go up and down completely randomly.
Pair Corralation between PetroChina and Inspur Software
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.74 times more return on investment than Inspur Software. However, PetroChina Co Ltd is 1.36 times less risky than Inspur Software. It trades about 0.06 of its potential returns per unit of risk. Inspur Software Co is currently generating about 0.01 per unit of risk. If you would invest 502.00 in PetroChina Co Ltd on November 5, 2024 and sell it today you would earn a total of 331.00 from holding PetroChina Co Ltd or generate 65.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Inspur Software Co
Performance |
| Timeline |
| PetroChina |
| Inspur Software |
PetroChina and Inspur Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Inspur Software
The main advantage of trading using opposite PetroChina and Inspur Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Inspur Software 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 Inspur Software will offset losses from the drop in Inspur Software's long position.| PetroChina vs. Fujian Longzhou Transportation | PetroChina vs. Eyebright Medical Technology | PetroChina vs. Cabio Biotech Wuhan | PetroChina vs. Montage Technology Co |
| Inspur Software vs. Guangzhou KingTeller Technology | Inspur Software vs. Maxvision Technology Corp | Inspur Software vs. Yankershop Food Co | Inspur Software vs. Fujian Newland Computer |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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