Correlation Between APG Securities and Petrolimex Petrochemical
Can any of the company-specific risk be diversified away by investing in both APG Securities and Petrolimex Petrochemical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining APG Securities and Petrolimex Petrochemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between APG Securities Joint and Petrolimex Petrochemical JSC, you can compare the effects of market volatilities on APG Securities and Petrolimex Petrochemical 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 APG Securities with a short position of Petrolimex Petrochemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of APG Securities and Petrolimex Petrochemical.
Diversification Opportunities for APG Securities and Petrolimex Petrochemical
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between APG and Petrolimex is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding APG Securities Joint and Petrolimex Petrochemical JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrolimex Petrochemical and APG Securities 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 APG Securities Joint are associated (or correlated) with Petrolimex Petrochemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrolimex Petrochemical has no effect on the direction of APG Securities i.e., APG Securities and Petrolimex Petrochemical go up and down completely randomly.
Pair Corralation between APG Securities and Petrolimex Petrochemical
Assuming the 90 days trading horizon APG Securities is expected to generate 2.01 times less return on investment than Petrolimex Petrochemical. In addition to that, APG Securities is 1.69 times more volatile than Petrolimex Petrochemical JSC. It trades about 0.06 of its total potential returns per unit of risk. Petrolimex Petrochemical JSC is currently generating about 0.2 per unit of volatility. If you would invest 2,270,000 in Petrolimex Petrochemical JSC on October 29, 2024 and sell it today you would earn a total of 190,000 from holding Petrolimex Petrochemical JSC or generate 8.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
APG Securities Joint vs. Petrolimex Petrochemical JSC
Performance |
| Timeline |
| APG Securities Joint |
| Petrolimex Petrochemical |
APG Securities and Petrolimex Petrochemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with APG Securities and Petrolimex Petrochemical
The main advantage of trading using opposite APG Securities and Petrolimex Petrochemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APG Securities position performs unexpectedly, Petrolimex Petrochemical 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 Petrolimex Petrochemical will offset losses from the drop in Petrolimex Petrochemical's long position.| APG Securities vs. Vietnam Technological And | APG Securities vs. Danang Education Investment | APG Securities vs. Sao Ta Foods | APG Securities vs. Innovative Technology Development |
| Petrolimex Petrochemical vs. Pha Le Plastics | Petrolimex Petrochemical vs. Century Synthetic Fiber | Petrolimex Petrochemical vs. Phuoc Hoa Rubber | Petrolimex Petrochemical vs. Danang Rubber JSC |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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