Correlation Between Petrolimex Information and BIDV Insurance
Can any of the company-specific risk be diversified away by investing in both Petrolimex Information and BIDV Insurance 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 Information and BIDV Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petrolimex Information Technology and BIDV Insurance Corp, you can compare the effects of market volatilities on Petrolimex Information and BIDV Insurance 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 Information with a short position of BIDV Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Information and BIDV Insurance.
Diversification Opportunities for Petrolimex Information and BIDV Insurance
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Petrolimex and BIDV is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Information Technol and BIDV Insurance Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIDV Insurance Corp and Petrolimex Information 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 Information Technology are associated (or correlated) with BIDV Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIDV Insurance Corp has no effect on the direction of Petrolimex Information i.e., Petrolimex Information and BIDV Insurance go up and down completely randomly.
Pair Corralation between Petrolimex Information and BIDV Insurance
Assuming the 90 days trading horizon Petrolimex Information Technology is expected to generate 2.79 times more return on investment than BIDV Insurance. However, Petrolimex Information is 2.79 times more volatile than BIDV Insurance Corp. It trades about 0.32 of its potential returns per unit of risk. BIDV Insurance Corp is currently generating about -0.06 per unit of risk. If you would invest 2,630,000 in Petrolimex Information Technology on November 3, 2024 and sell it today you would earn a total of 260,000 from holding Petrolimex Information Technology or generate 9.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 55.56% |
| Values | Daily Returns |
Petrolimex Information Technol vs. BIDV Insurance Corp
Performance |
| Timeline |
| Petrolimex Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| BIDV Insurance Corp |
Petrolimex Information and BIDV Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Information and BIDV Insurance
The main advantage of trading using opposite Petrolimex Information and BIDV Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Information position performs unexpectedly, BIDV Insurance 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 BIDV Insurance will offset losses from the drop in BIDV Insurance's long position.| Petrolimex Information vs. MST Investment JSC | Petrolimex Information vs. BIDV Insurance Corp | Petrolimex Information vs. VTC Telecommunications JSC | Petrolimex Information vs. Dinhvu Port Investment |
| BIDV Insurance vs. Petrolimex Insurance Corp | BIDV Insurance vs. Innovative Technology Development | BIDV Insurance vs. Post and Telecommunications | BIDV Insurance vs. Hai An Transport |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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