Correlation Between Petrolimex Information and Ducgiang Chemicals
Can any of the company-specific risk be diversified away by investing in both Petrolimex Information and Ducgiang Chemicals 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 Ducgiang Chemicals 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 Ducgiang Chemicals Detergent, you can compare the effects of market volatilities on Petrolimex Information and Ducgiang Chemicals 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 Ducgiang Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Information and Ducgiang Chemicals.
Diversification Opportunities for Petrolimex Information and Ducgiang Chemicals
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Petrolimex and Ducgiang is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Information Technol and Ducgiang Chemicals Detergent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ducgiang Chemicals 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 Ducgiang Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ducgiang Chemicals has no effect on the direction of Petrolimex Information i.e., Petrolimex Information and Ducgiang Chemicals go up and down completely randomly.
Pair Corralation between Petrolimex Information and Ducgiang Chemicals
Assuming the 90 days trading horizon Petrolimex Information Technology is expected to generate 3.18 times more return on investment than Ducgiang Chemicals. However, Petrolimex Information is 3.18 times more volatile than Ducgiang Chemicals Detergent. It trades about 0.18 of its potential returns per unit of risk. Ducgiang Chemicals Detergent is currently generating about -0.24 per unit of risk. If you would invest 2,720,000 in Petrolimex Information Technology on October 28, 2024 and sell it today you would earn a total of 170,000 from holding Petrolimex Information Technology or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 57.14% |
| Values | Daily Returns |
Petrolimex Information Technol vs. Ducgiang Chemicals Detergent
Performance |
| Timeline |
| Petrolimex Information |
| Ducgiang Chemicals |
Petrolimex Information and Ducgiang Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Information and Ducgiang Chemicals
The main advantage of trading using opposite Petrolimex Information and Ducgiang Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Information position performs unexpectedly, Ducgiang Chemicals 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 Ducgiang Chemicals will offset losses from the drop in Ducgiang Chemicals' long position.| Petrolimex Information vs. Ba Ria Thermal | Petrolimex Information vs. CEO Group JSC | Petrolimex Information vs. Pha Le Plastics | Petrolimex Information vs. Tay Ninh Rubber |
| Ducgiang Chemicals vs. Thong Nhat Rubber | Ducgiang Chemicals vs. Industrial Urban Development | Ducgiang Chemicals vs. Fecon Mining JSC | Ducgiang Chemicals vs. Materials Petroleum 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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