Correlation Between PetroChina and Linewell Software
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By analyzing existing cross correlation between PetroChina Co Ltd and Linewell Software Co, you can compare the effects of market volatilities on PetroChina and Linewell Software 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 Linewell Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Linewell Software.
Diversification Opportunities for PetroChina and Linewell Software
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and Linewell is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Linewell Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linewell Software 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 Linewell Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linewell Software has no effect on the direction of PetroChina i.e., PetroChina and Linewell Software go up and down completely randomly.
Pair Corralation between PetroChina and Linewell Software
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Linewell Software. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 3.58 times less risky than Linewell Software. The stock trades about -0.17 of its potential returns per unit of risk. The Linewell Software Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,135 in Linewell Software Co on August 28, 2024 and sell it today you would lose (6.00) from holding Linewell Software Co or give up 0.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Linewell Software Co
Performance |
| Timeline |
| PetroChina |
| Linewell Software |
PetroChina and Linewell Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Linewell Software
The main advantage of trading using opposite PetroChina and Linewell Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Linewell Software 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 Linewell Software will offset losses from the drop in Linewell Software's long position.| PetroChina vs. Sunwave Communications Co | PetroChina vs. City Development Environment | PetroChina vs. Gansu Jiu Steel | PetroChina vs. GreenTech Environmental Co |
| Linewell Software vs. Kunshan Guoli Electronic | Linewell Software vs. Bomin Electronics Co | Linewell Software vs. Xiangyang Automobile Bearing | Linewell Software vs. Changchun Faway Automobile |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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