Correlation Between Railway Signal and PetroChina
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By analyzing existing cross correlation between Railway Signal Communication and PetroChina Co Ltd, you can compare the effects of market volatilities on Railway Signal 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 Railway Signal with a short position of PetroChina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Railway Signal and PetroChina.
Diversification Opportunities for Railway Signal and PetroChina
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Railway and PetroChina is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Railway Signal Communication and PetroChina Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroChina and Railway Signal 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 Railway Signal Communication 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 Railway Signal i.e., Railway Signal and PetroChina go up and down completely randomly.
Pair Corralation between Railway Signal and PetroChina
Assuming the 90 days trading horizon Railway Signal Communication is expected to generate 1.42 times more return on investment than PetroChina. However, Railway Signal is 1.42 times more volatile than PetroChina Co Ltd. It trades about 0.02 of its potential returns per unit of risk. PetroChina Co Ltd is currently generating about -0.41 per unit of risk. If you would invest 581.00 in Railway Signal Communication on November 27, 2024 and sell it today you would earn a total of 2.00 from holding Railway Signal Communication or generate 0.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Railway Signal Communication vs. PetroChina Co Ltd
Performance |
| Timeline |
| Railway Signal Commu |
| PetroChina |
Railway Signal and PetroChina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Railway Signal and PetroChina
The main advantage of trading using opposite Railway Signal and PetroChina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Railway Signal 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.| Railway Signal vs. Jiangxi Sunshine Dairy | Railway Signal vs. Yankershop Food Co | Railway Signal vs. Vats Liquor Chain | Railway Signal vs. Guilin Seamild Foods |
| PetroChina vs. Xinxiang Chemical Fiber | PetroChina vs. Duzhe Publishing Media | PetroChina vs. Mega info Media CoLtd | PetroChina vs. Longxing Chemical Stock |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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