Correlation Between Petrolimex Insurance and Saigon Viendong
Can any of the company-specific risk be diversified away by investing in both Petrolimex Insurance and Saigon Viendong 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 Viendong 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 Viendong Technology, you can compare the effects of market volatilities on Petrolimex Insurance and Saigon Viendong 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 Viendong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Insurance and Saigon Viendong.
Diversification Opportunities for Petrolimex Insurance and Saigon Viendong
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Petrolimex and Saigon is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Insurance Corp and Saigon Viendong Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Viendong Tech 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 Viendong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Viendong Tech has no effect on the direction of Petrolimex Insurance i.e., Petrolimex Insurance and Saigon Viendong go up and down completely randomly.
Pair Corralation between Petrolimex Insurance and Saigon Viendong
Assuming the 90 days trading horizon Petrolimex Insurance is expected to generate 6.4 times less return on investment than Saigon Viendong. But when comparing it to its historical volatility, Petrolimex Insurance Corp is 1.0 times less risky than Saigon Viendong. It trades about 0.01 of its potential returns per unit of risk. Saigon Viendong Technology is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,068,132 in Saigon Viendong Technology on September 3, 2024 and sell it today you would earn a total of 71,868 from holding Saigon Viendong Technology or generate 6.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 88.73% |
| Values | Daily Returns |
Petrolimex Insurance Corp vs. Saigon Viendong Technology
Performance |
| Timeline |
| Petrolimex Insurance Corp |
| Saigon Viendong Tech |
Petrolimex Insurance and Saigon Viendong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Insurance and Saigon Viendong
The main advantage of trading using opposite Petrolimex Insurance and Saigon Viendong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Insurance position performs unexpectedly, Saigon Viendong 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 Viendong will offset losses from the drop in Saigon Viendong'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 Viendong vs. FIT INVEST JSC | Saigon Viendong vs. Damsan JSC | Saigon Viendong vs. An Phat Plastic | Saigon Viendong vs. Alphanam ME |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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