Correlation Between Mobile World and Petrolimex Information
Can any of the company-specific risk be diversified away by investing in both Mobile World 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 Mobile World and Petrolimex Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mobile World Investment and Petrolimex Information Technology, you can compare the effects of market volatilities on Mobile World 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 Mobile World with a short position of Petrolimex Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobile World and Petrolimex Information.
Diversification Opportunities for Mobile World and Petrolimex Information
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mobile and Petrolimex is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mobile World Investment and Petrolimex Information Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrolimex Information and Mobile World 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 Mobile World Investment 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 Mobile World i.e., Mobile World and Petrolimex Information go up and down completely randomly.
Pair Corralation between Mobile World and Petrolimex Information
Assuming the 90 days trading horizon Mobile World is expected to generate 1.8 times less return on investment than Petrolimex Information. But when comparing it to its historical volatility, Mobile World Investment is 2.44 times less risky than Petrolimex Information. It trades about 0.05 of its potential returns per unit of risk. Petrolimex Information Technology is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,306,358 in Petrolimex Information Technology on September 2, 2024 and sell it today you would earn a total of 383,642 from holding Petrolimex Information Technology or generate 16.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 57.8% |
| Values | Daily Returns |
Mobile World Investment vs. Petrolimex Information Technol
Performance |
| Timeline |
| Mobile World Investment |
| Petrolimex Information |
Mobile World and Petrolimex Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mobile World and Petrolimex Information
The main advantage of trading using opposite Mobile World and Petrolimex Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mobile World 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.| Mobile World vs. Da Nang Construction | Mobile World vs. Agriculture Printing and | Mobile World vs. Petrolimex Information Technology | Mobile World vs. Binhthuan Agriculture Services |
| Petrolimex Information vs. Song Hong Garment | Petrolimex Information vs. Alphanam ME | Petrolimex Information vs. Hochiminh City Metal | Petrolimex Information vs. Atesco Industrial Cartering |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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