Correlation Between PetroChina and Guangzhou Automobile
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By analyzing existing cross correlation between PetroChina Co Ltd and Guangzhou Automobile Group, you can compare the effects of market volatilities on PetroChina and Guangzhou Automobile 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 Guangzhou Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Guangzhou Automobile.
Diversification Opportunities for PetroChina and Guangzhou Automobile
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PetroChina and Guangzhou is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Guangzhou Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Automobile 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 Guangzhou Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Automobile has no effect on the direction of PetroChina i.e., PetroChina and Guangzhou Automobile go up and down completely randomly.
Pair Corralation between PetroChina and Guangzhou Automobile
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 1.02 times more return on investment than Guangzhou Automobile. However, PetroChina is 1.02 times more volatile than Guangzhou Automobile Group. It trades about 0.02 of its potential returns per unit of risk. Guangzhou Automobile Group is currently generating about -0.02 per unit of risk. If you would invest 741.00 in PetroChina Co Ltd on January 30, 2025 and sell it today you would earn a total of 53.00 from holding PetroChina Co Ltd or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Guangzhou Automobile Group
Performance |
| Timeline |
| PetroChina |
| Guangzhou Automobile |
PetroChina and Guangzhou Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Guangzhou Automobile
The main advantage of trading using opposite PetroChina and Guangzhou Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Guangzhou Automobile 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 Guangzhou Automobile will offset losses from the drop in Guangzhou Automobile's long position.| PetroChina vs. Cultural Investment Holdings | PetroChina vs. Hubei Xingfa Chemicals | PetroChina vs. China Asset Management | PetroChina vs. Yingde Greatchem Chemicals |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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