Correlation Between Military Insurance and Petrolimex Information
Can any of the company-specific risk be diversified away by investing in both Military Insurance and Petrolimex Information 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 Military Insurance and Petrolimex Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Military Insurance Corp and Petrolimex Information Technology, you can compare the effects of market volatilities on Military Insurance and Petrolimex Information 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 Military Insurance with a short position of Petrolimex Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Military Insurance and Petrolimex Information.
Diversification Opportunities for Military Insurance and Petrolimex Information
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Military and Petrolimex is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Military Insurance Corp and Petrolimex Information Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrolimex Information and Military Insurance 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 Military Insurance Corp are associated (or correlated) with Petrolimex Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrolimex Information has no effect on the direction of Military Insurance i.e., Military Insurance and Petrolimex Information go up and down completely randomly.
Pair Corralation between Military Insurance and Petrolimex Information
Assuming the 90 days trading horizon Military Insurance Corp is expected to generate 3.73 times more return on investment than Petrolimex Information. However, Military Insurance is 3.73 times more volatile than Petrolimex Information Technology. It trades about 0.31 of its potential returns per unit of risk. Petrolimex Information Technology is currently generating about 0.58 per unit of risk. If you would invest 1,705,000 in Military Insurance Corp on November 28, 2024 and sell it today you would earn a total of 150,000 from holding Military Insurance Corp or generate 8.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 70.59% |
| Values | Daily Returns |
Military Insurance Corp vs. Petrolimex Information Technol
Performance |
| Timeline |
| Military Insurance Corp |
| Petrolimex Information |
Military Insurance and Petrolimex Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Military Insurance and Petrolimex Information
The main advantage of trading using opposite Military Insurance and Petrolimex Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Military Insurance position performs unexpectedly, Petrolimex Information 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 Information will offset losses from the drop in Petrolimex Information's long position.| Military Insurance vs. Foreign Trade Development | Military Insurance vs. Saigon Telecommunication Technologies | Military Insurance vs. PC3 Investment JSC | Military Insurance vs. Binh Duong Trade |
| Petrolimex Information vs. Materials Petroleum JSC | Petrolimex Information vs. Pha Le Plastics | Petrolimex Information vs. Long An Food | Petrolimex Information vs. Vnsteel Vicasa 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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