Correlation Between PetroChina and Guangzhou Fangbang
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By analyzing existing cross correlation between PetroChina Co Ltd and Guangzhou Fangbang Electronics, you can compare the effects of market volatilities on PetroChina and Guangzhou Fangbang 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 Fangbang. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Guangzhou Fangbang.
Diversification Opportunities for PetroChina and Guangzhou Fangbang
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PetroChina and Guangzhou is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Guangzhou Fangbang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Fangbang 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 Fangbang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Fangbang has no effect on the direction of PetroChina i.e., PetroChina and Guangzhou Fangbang go up and down completely randomly.
Pair Corralation between PetroChina and Guangzhou Fangbang
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.49 times more return on investment than Guangzhou Fangbang. However, PetroChina Co Ltd is 2.05 times less risky than Guangzhou Fangbang. It trades about 0.07 of its potential returns per unit of risk. Guangzhou Fangbang Electronics is currently generating about 0.0 per unit of risk. If you would invest 506.00 in PetroChina Co Ltd on October 16, 2024 and sell it today you would earn a total of 381.00 from holding PetroChina Co Ltd or generate 75.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Guangzhou Fangbang Electronics
Performance |
| Timeline |
| PetroChina |
| Guangzhou Fangbang |
PetroChina and Guangzhou Fangbang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Guangzhou Fangbang
The main advantage of trading using opposite PetroChina and Guangzhou Fangbang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Guangzhou Fangbang 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 Fangbang will offset losses from the drop in Guangzhou Fangbang's long position.| PetroChina vs. Qingdao Foods Co | PetroChina vs. Hubeiyichang Transportation Group | PetroChina vs. Guangdong Wens Foodstuff | PetroChina vs. Youyou Foods Co |
| Guangzhou Fangbang vs. Universal Scientific Industrial | Guangzhou Fangbang vs. Jiaozuo Wanfang Aluminum | Guangzhou Fangbang vs. Porton Fine Chemicals | Guangzhou Fangbang vs. Shanghai Yanpu Metal |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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