Correlation Between Petrolimex Information and Tay Ninh
Can any of the company-specific risk be diversified away by investing in both Petrolimex Information and Tay Ninh 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 Tay Ninh 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 Tay Ninh Rubber, you can compare the effects of market volatilities on Petrolimex Information and Tay Ninh 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 Tay Ninh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Information and Tay Ninh.
Diversification Opportunities for Petrolimex Information and Tay Ninh
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Petrolimex and Tay is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Information Technol and Tay Ninh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tay Ninh Rubber 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 Tay Ninh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tay Ninh Rubber has no effect on the direction of Petrolimex Information i.e., Petrolimex Information and Tay Ninh go up and down completely randomly.
Pair Corralation between Petrolimex Information and Tay Ninh
Assuming the 90 days trading horizon Petrolimex Information Technology is expected to generate 2.13 times more return on investment than Tay Ninh. However, Petrolimex Information is 2.13 times more volatile than Tay Ninh Rubber. It trades about 0.04 of its potential returns per unit of risk. Tay Ninh Rubber is currently generating about 0.08 per unit of risk. If you would invest 2,491,111 in Petrolimex Information Technology on September 3, 2024 and sell it today you would earn a total of 198,889 from holding Petrolimex Information Technology or generate 7.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 78.05% |
| Values | Daily Returns |
Petrolimex Information Technol vs. Tay Ninh Rubber
Performance |
| Timeline |
| Petrolimex Information |
| Tay Ninh Rubber |
Petrolimex Information and Tay Ninh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Information and Tay Ninh
The main advantage of trading using opposite Petrolimex Information and Tay Ninh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Information position performs unexpectedly, Tay Ninh 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 Tay Ninh will offset losses from the drop in Tay Ninh's long position.| Petrolimex Information vs. Vinhomes JSC | Petrolimex Information vs. Picomat Plastic JSC | Petrolimex Information vs. Phuoc Hoa Rubber | Petrolimex Information vs. Japan Vietnam Medical |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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