Correlation Between PetroChina and Shenzhen SDG
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By analyzing existing cross correlation between PetroChina Co Ltd and Shenzhen SDG Service, you can compare the effects of market volatilities on PetroChina and Shenzhen SDG 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 Shenzhen SDG. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Shenzhen SDG.
Diversification Opportunities for PetroChina and Shenzhen SDG
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PetroChina and Shenzhen is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Shenzhen SDG Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen SDG Service 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 Shenzhen SDG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen SDG Service has no effect on the direction of PetroChina i.e., PetroChina and Shenzhen SDG go up and down completely randomly.
Pair Corralation between PetroChina and Shenzhen SDG
Assuming the 90 days trading horizon PetroChina is expected to generate 15.45 times less return on investment than Shenzhen SDG. But when comparing it to its historical volatility, PetroChina Co Ltd is 3.6 times less risky than Shenzhen SDG. It trades about 0.03 of its potential returns per unit of risk. Shenzhen SDG Service is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3,545 in Shenzhen SDG Service on September 25, 2024 and sell it today you would earn a total of 1,607 from holding Shenzhen SDG Service or generate 45.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.33% |
Values | Daily Returns |
PetroChina Co Ltd vs. Shenzhen SDG Service
Performance |
Timeline |
PetroChina |
Shenzhen SDG Service |
PetroChina and Shenzhen SDG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PetroChina and Shenzhen SDG
The main advantage of trading using opposite PetroChina and Shenzhen SDG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Shenzhen SDG 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 Shenzhen SDG will offset losses from the drop in Shenzhen SDG's long position.PetroChina vs. Xinjiang Baodi Mining | PetroChina vs. Guocheng Mining Co | PetroChina vs. Huaibei Mining Holdings | PetroChina vs. Fujian Oriental Silver |
Shenzhen SDG vs. PetroChina Co Ltd | Shenzhen SDG vs. China Mobile Limited | Shenzhen SDG vs. CNOOC Limited | Shenzhen SDG vs. Ping An Insurance |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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