Correlation Between South Basic and Vietnam Petroleum
Can any of the company-specific risk be diversified away by investing in both South Basic and Vietnam Petroleum 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 South Basic and Vietnam Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between South Basic Chemicals and Vietnam Petroleum Transport, you can compare the effects of market volatilities on South Basic and Vietnam Petroleum 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 South Basic with a short position of Vietnam Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of South Basic and Vietnam Petroleum.
Diversification Opportunities for South Basic and Vietnam Petroleum
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between South and Vietnam is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding South Basic Chemicals and Vietnam Petroleum Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam Petroleum and South Basic 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 South Basic Chemicals are associated (or correlated) with Vietnam Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam Petroleum has no effect on the direction of South Basic i.e., South Basic and Vietnam Petroleum go up and down completely randomly.
Pair Corralation between South Basic and Vietnam Petroleum
Assuming the 90 days trading horizon South Basic is expected to generate 3.55 times less return on investment than Vietnam Petroleum. In addition to that, South Basic is 1.09 times more volatile than Vietnam Petroleum Transport. It trades about 0.06 of its total potential returns per unit of risk. Vietnam Petroleum Transport is currently generating about 0.22 per unit of volatility. If you would invest 1,280,000 in Vietnam Petroleum Transport on September 2, 2024 and sell it today you would earn a total of 140,000 from holding Vietnam Petroleum Transport or generate 10.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
South Basic Chemicals vs. Vietnam Petroleum Transport
Performance |
| Timeline |
| South Basic Chemicals |
| Vietnam Petroleum |
South Basic and Vietnam Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with South Basic and Vietnam Petroleum
The main advantage of trading using opposite South Basic and Vietnam Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South Basic position performs unexpectedly, Vietnam Petroleum 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 Vietnam Petroleum will offset losses from the drop in Vietnam Petroleum's long position.| South Basic vs. Vu Dang Investment | South Basic vs. Thanh Dat Investment | South Basic vs. DOMESCO Medical Import | South Basic vs. Tien Giang Investment |
| Vietnam Petroleum vs. Everland Investment JSC | Vietnam Petroleum vs. Tin Nghia Industrial | Vietnam Petroleum vs. PV2 Investment JSC | Vietnam Petroleum vs. Vien Dong Investment |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |