Correlation Between Petrolimex Insurance and Saigon Thuong
Can any of the company-specific risk be diversified away by investing in both Petrolimex Insurance and Saigon Thuong 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 Petrolimex Insurance and Saigon Thuong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petrolimex Insurance Corp and Saigon Thuong Tin, you can compare the effects of market volatilities on Petrolimex Insurance and Saigon Thuong 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 Petrolimex Insurance with a short position of Saigon Thuong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Insurance and Saigon Thuong.
Diversification Opportunities for Petrolimex Insurance and Saigon Thuong
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petrolimex and Saigon is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Insurance Corp and Saigon Thuong Tin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Thuong Tin and Petrolimex 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 Petrolimex Insurance Corp are associated (or correlated) with Saigon Thuong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Thuong Tin has no effect on the direction of Petrolimex Insurance i.e., Petrolimex Insurance and Saigon Thuong go up and down completely randomly.
Pair Corralation between Petrolimex Insurance and Saigon Thuong
Assuming the 90 days trading horizon Petrolimex Insurance Corp is expected to generate 1.55 times more return on investment than Saigon Thuong. However, Petrolimex Insurance is 1.55 times more volatile than Saigon Thuong Tin. It trades about 0.01 of its potential returns per unit of risk. Saigon Thuong Tin is currently generating about -0.07 per unit of risk. If you would invest 2,269,948 in Petrolimex Insurance Corp on September 4, 2024 and sell it today you would earn a total of 52.00 from holding Petrolimex Insurance Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 73.47% |
| Values | Daily Returns |
Petrolimex Insurance Corp vs. Saigon Thuong Tin
Performance |
| Timeline |
| Petrolimex Insurance Corp |
| Saigon Thuong Tin |
Petrolimex Insurance and Saigon Thuong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Insurance and Saigon Thuong
The main advantage of trading using opposite Petrolimex Insurance and Saigon Thuong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Insurance position performs unexpectedly, Saigon Thuong 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 Saigon Thuong will offset losses from the drop in Saigon Thuong's long position.| Petrolimex Insurance vs. FIT INVEST JSC | Petrolimex Insurance vs. Damsan JSC | Petrolimex Insurance vs. An Phat Plastic | Petrolimex Insurance vs. Alphanam ME |
| Saigon Thuong vs. Song Hong Construction | Saigon Thuong vs. RangDong Plastic JSC | Saigon Thuong vs. Saigon Beer Alcohol | Saigon Thuong vs. Dong Nai Plastic |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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