Correlation Between PetroChina and Longjian Road
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By analyzing existing cross correlation between PetroChina Co Ltd and Longjian Road Bridge, you can compare the effects of market volatilities on PetroChina and Longjian Road 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 Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Longjian Road.
Diversification Opportunities for PetroChina and Longjian Road
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between PetroChina and Longjian is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge 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 Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of PetroChina i.e., PetroChina and Longjian Road go up and down completely randomly.
Pair Corralation between PetroChina and Longjian Road
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Longjian Road. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 2.27 times less risky than Longjian Road. The stock trades about -0.41 of its potential returns per unit of risk. The Longjian Road Bridge is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 371.00 in Longjian Road Bridge on November 27, 2024 and sell it today you would earn a total of 6.00 from holding Longjian Road Bridge or generate 1.62% 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. Longjian Road Bridge
Performance |
| Timeline |
| PetroChina |
| Longjian Road Bridge |
PetroChina and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Longjian Road
The main advantage of trading using opposite PetroChina and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road's long position.| PetroChina vs. Xinxiang Chemical Fiber | PetroChina vs. Duzhe Publishing Media | PetroChina vs. Mega info Media CoLtd | PetroChina vs. Longxing Chemical Stock |
| Longjian Road vs. By health | Longjian Road vs. Gansu Huangtai Wine marketing | Longjian Road vs. China Reform Health | Longjian Road vs. Hengxin Mobile Business |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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