Correlation Between FIT INVEST and PetroVietnam Transportation
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and PetroVietnam Transportation 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 FIT INVEST and PetroVietnam Transportation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIT INVEST JSC and PetroVietnam Transportation Corp, you can compare the effects of market volatilities on FIT INVEST and PetroVietnam Transportation 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 FIT INVEST with a short position of PetroVietnam Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and PetroVietnam Transportation.
Diversification Opportunities for FIT INVEST and PetroVietnam Transportation
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FIT and PetroVietnam is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and PetroVietnam Transportation Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroVietnam Transportation and FIT INVEST 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 FIT INVEST JSC are associated (or correlated) with PetroVietnam Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetroVietnam Transportation has no effect on the direction of FIT INVEST i.e., FIT INVEST and PetroVietnam Transportation go up and down completely randomly.
Pair Corralation between FIT INVEST and PetroVietnam Transportation
Assuming the 90 days trading horizon FIT INVEST is expected to generate 11.01 times less return on investment than PetroVietnam Transportation. In addition to that, FIT INVEST is 1.07 times more volatile than PetroVietnam Transportation Corp. It trades about 0.0 of its total potential returns per unit of risk. PetroVietnam Transportation Corp is currently generating about 0.05 per unit of volatility. If you would invest 1,697,950 in PetroVietnam Transportation Corp on October 30, 2024 and sell it today you would earn a total of 912,050 from holding PetroVietnam Transportation Corp or generate 53.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
FIT INVEST JSC vs. PetroVietnam Transportation Co
Performance |
Timeline |
FIT INVEST JSC |
PetroVietnam Transportation |
FIT INVEST and PetroVietnam Transportation Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FIT INVEST and PetroVietnam Transportation
The main advantage of trading using opposite FIT INVEST and PetroVietnam Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, PetroVietnam Transportation 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 PetroVietnam Transportation will offset losses from the drop in PetroVietnam Transportation's long position.FIT INVEST vs. Duong Hieu Trading | FIT INVEST vs. Transport and Industry | FIT INVEST vs. HVC Investment and | FIT INVEST vs. Din Capital Investment |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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