Correlation Between PetroChina and Xiamen Goldenhome
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By analyzing existing cross correlation between PetroChina Co Ltd and Xiamen Goldenhome Co, you can compare the effects of market volatilities on PetroChina and Xiamen Goldenhome 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 Xiamen Goldenhome. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Xiamen Goldenhome.
Diversification Opportunities for PetroChina and Xiamen Goldenhome
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between PetroChina and Xiamen is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Xiamen Goldenhome Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Goldenhome 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 Xiamen Goldenhome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Goldenhome has no effect on the direction of PetroChina i.e., PetroChina and Xiamen Goldenhome go up and down completely randomly.
Pair Corralation between PetroChina and Xiamen Goldenhome
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Xiamen Goldenhome. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 1.68 times less risky than Xiamen Goldenhome. The stock trades about -0.17 of its potential returns per unit of risk. The Xiamen Goldenhome Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,969 in Xiamen Goldenhome Co on August 28, 2024 and sell it today you would earn a total of 51.00 from holding Xiamen Goldenhome Co or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Xiamen Goldenhome Co
Performance |
| Timeline |
| PetroChina |
| Xiamen Goldenhome |
PetroChina and Xiamen Goldenhome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Xiamen Goldenhome
The main advantage of trading using opposite PetroChina and Xiamen Goldenhome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Xiamen Goldenhome 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 Xiamen Goldenhome will offset losses from the drop in Xiamen Goldenhome's long position.| PetroChina vs. Sunwave Communications Co | PetroChina vs. City Development Environment | PetroChina vs. Gansu Jiu Steel | PetroChina vs. GreenTech Environmental Co |
| Xiamen Goldenhome vs. China Petroleum Chemical | Xiamen Goldenhome vs. PetroChina Co Ltd | Xiamen Goldenhome vs. China State Construction | Xiamen Goldenhome vs. China Railway Group |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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