Correlation Between PetroChina and Mengtian Home
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By analyzing existing cross correlation between PetroChina Co Ltd and Mengtian Home Group, you can compare the effects of market volatilities on PetroChina and Mengtian Home 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 Mengtian Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Mengtian Home.
Diversification Opportunities for PetroChina and Mengtian Home
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and Mengtian is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Mengtian Home Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mengtian Home Group 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 Mengtian Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mengtian Home Group has no effect on the direction of PetroChina i.e., PetroChina and Mengtian Home go up and down completely randomly.
Pair Corralation between PetroChina and Mengtian Home
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.83 times more return on investment than Mengtian Home. However, PetroChina Co Ltd is 1.2 times less risky than Mengtian Home. It trades about 0.06 of its potential returns per unit of risk. Mengtian Home Group is currently generating about -0.01 per unit of risk. If you would invest 517.00 in PetroChina Co Ltd on August 25, 2024 and sell it today you would earn a total of 284.00 from holding PetroChina Co Ltd or generate 54.93% 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. Mengtian Home Group
Performance |
| Timeline |
| PetroChina |
| Mengtian Home Group |
PetroChina and Mengtian Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Mengtian Home
The main advantage of trading using opposite PetroChina and Mengtian Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Mengtian Home 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 Mengtian Home will offset losses from the drop in Mengtian Home's long position.| PetroChina vs. Zhejiang Kingland Pipeline | PetroChina vs. COL Digital Publishing | PetroChina vs. Suzhou Novoprotein Scientific | PetroChina vs. Xiangyang Automobile Bearing |
| Mengtian Home vs. China Petroleum Chemical | Mengtian Home vs. PetroChina Co Ltd | Mengtian Home vs. China State Construction | Mengtian Home 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 CEOs Directory module to screen CEOs from public companies around the world.
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