Correlation Between PetroChina and Metro Investment
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By analyzing existing cross correlation between PetroChina Co Ltd and Metro Investment Development, you can compare the effects of market volatilities on PetroChina and Metro Investment 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 Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Metro Investment.
Diversification Opportunities for PetroChina and Metro Investment
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PetroChina and Metro is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of PetroChina i.e., PetroChina and Metro Investment go up and down completely randomly.
Pair Corralation between PetroChina and Metro Investment
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.53 times more return on investment than Metro Investment. However, PetroChina Co Ltd is 1.88 times less risky than Metro Investment. It trades about 0.14 of its potential returns per unit of risk. Metro Investment Development is currently generating about 0.05 per unit of risk. If you would invest 803.00 in PetroChina Co Ltd on September 24, 2024 and sell it today you would earn a total of 31.00 from holding PetroChina Co Ltd or generate 3.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PetroChina Co Ltd vs. Metro Investment Development
Performance |
Timeline |
PetroChina |
Metro Investment Dev |
PetroChina and Metro Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PetroChina and Metro Investment
The main advantage of trading using opposite PetroChina and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Metro Investment 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 Metro Investment will offset losses from the drop in Metro Investment's long position.PetroChina vs. Zhejiang Kingland Pipeline | PetroChina vs. Jiangsu Zhongtian Technology | PetroChina vs. Shaanxi Beiyuan Chemical | PetroChina vs. Sinomine Resource Exploration |
Metro Investment vs. PetroChina Co Ltd | Metro Investment vs. China Mobile Limited | Metro Investment vs. CNOOC Limited | Metro Investment 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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