Correlation Between PetroChina and Air China
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By analyzing existing cross correlation between PetroChina Co Ltd and Air China Ltd, you can compare the effects of market volatilities on PetroChina and Air China 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 Air China. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Air China.
Diversification Opportunities for PetroChina and Air China
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PetroChina and Air is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Air China Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air China 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 Air China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air China has no effect on the direction of PetroChina i.e., PetroChina and Air China go up and down completely randomly.
Pair Corralation between PetroChina and Air China
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.71 times more return on investment than Air China. However, PetroChina Co Ltd is 1.41 times less risky than Air China. It trades about 0.04 of its potential returns per unit of risk. Air China Ltd is currently generating about -0.1 per unit of risk. If you would invest 803.00 in PetroChina Co Ltd on October 29, 2024 and sell it today you would earn a total of 19.00 from holding PetroChina Co Ltd or generate 2.37% 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. Air China Ltd
Performance |
| Timeline |
| PetroChina |
| Air China |
PetroChina and Air China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Air China
The main advantage of trading using opposite PetroChina and Air China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Air China 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 Air China will offset losses from the drop in Air China's long position.| PetroChina vs. Shenzhen Topway Video | PetroChina vs. Ningbo Fangzheng Automobile | PetroChina vs. Zotye Automobile Co | PetroChina vs. Meinian Onehealth Healthcare |
| Air China vs. Beijing Baolande Software | Air China vs. Inspur Software Co | Air China vs. Linewell Software Co | Air China vs. Hangzhou Pinming Software |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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