Correlation Between Guangdong Liantai and PetroChina
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By analyzing existing cross correlation between Guangdong Liantai Environmental and PetroChina Co Ltd, you can compare the effects of market volatilities on Guangdong Liantai and PetroChina 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 Guangdong Liantai with a short position of PetroChina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Liantai and PetroChina.
Diversification Opportunities for Guangdong Liantai and PetroChina
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangdong and PetroChina is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Liantai Environmenta and PetroChina Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroChina and Guangdong Liantai 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 Guangdong Liantai Environmental are associated (or correlated) with PetroChina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetroChina has no effect on the direction of Guangdong Liantai i.e., Guangdong Liantai and PetroChina go up and down completely randomly.
Pair Corralation between Guangdong Liantai and PetroChina
Assuming the 90 days trading horizon Guangdong Liantai Environmental is expected to generate 1.34 times more return on investment than PetroChina. However, Guangdong Liantai is 1.34 times more volatile than PetroChina Co Ltd. It trades about 0.08 of its potential returns per unit of risk. PetroChina Co Ltd is currently generating about -0.18 per unit of risk. If you would invest 403.00 in Guangdong Liantai Environmental on September 3, 2024 and sell it today you would earn a total of 27.00 from holding Guangdong Liantai Environmental or generate 6.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Liantai Environmenta vs. PetroChina Co Ltd
Performance |
| Timeline |
| Guangdong Liantai |
| PetroChina |
Guangdong Liantai and PetroChina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Liantai and PetroChina
The main advantage of trading using opposite Guangdong Liantai and PetroChina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Liantai position performs unexpectedly, PetroChina 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 PetroChina will offset losses from the drop in PetroChina's long position.| Guangdong Liantai vs. Touchstone International Medical | Guangdong Liantai vs. Gansu Jiu Steel | Guangdong Liantai vs. Hubei Xingfa Chemicals | Guangdong Liantai vs. Fujian Nanwang Environment |
| PetroChina vs. China Express Airlines | PetroChina vs. Xinhua Winshare Publishing | PetroChina vs. Jinhui Liquor Co | PetroChina vs. Beijing Kaiwen Education |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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