Correlation Between Petrolimex Petrochemical and PetroVietnam Transportation
Can any of the company-specific risk be diversified away by investing in both Petrolimex Petrochemical and PetroVietnam Transportation 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 Petrochemical and PetroVietnam Transportation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petrolimex Petrochemical JSC and PetroVietnam Transportation Corp, you can compare the effects of market volatilities on Petrolimex Petrochemical and PetroVietnam Transportation 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 Petrochemical with a short position of PetroVietnam Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrolimex Petrochemical and PetroVietnam Transportation.
Diversification Opportunities for Petrolimex Petrochemical and PetroVietnam Transportation
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petrolimex and PetroVietnam is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Petrolimex Petrochemical JSC and PetroVietnam Transportation Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroVietnam Transportation and Petrolimex Petrochemical 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 Petrochemical JSC are associated (or correlated) with PetroVietnam Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetroVietnam Transportation has no effect on the direction of Petrolimex Petrochemical i.e., Petrolimex Petrochemical and PetroVietnam Transportation go up and down completely randomly.
Pair Corralation between Petrolimex Petrochemical and PetroVietnam Transportation
Assuming the 90 days trading horizon Petrolimex Petrochemical JSC is expected to under-perform the PetroVietnam Transportation. In addition to that, Petrolimex Petrochemical is 1.69 times more volatile than PetroVietnam Transportation Corp. It trades about -0.16 of its total potential returns per unit of risk. PetroVietnam Transportation Corp is currently generating about 0.0 per unit of volatility. If you would invest 2,730,000 in PetroVietnam Transportation Corp on August 28, 2024 and sell it today you would lose (5,000) from holding PetroVietnam Transportation Corp or give up 0.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Petrolimex Petrochemical JSC vs. PetroVietnam Transportation Co
Performance |
| Timeline |
| Petrolimex Petrochemical |
| PetroVietnam Transportation |
Petrolimex Petrochemical and PetroVietnam Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrolimex Petrochemical and PetroVietnam Transportation
The main advantage of trading using opposite Petrolimex Petrochemical and PetroVietnam Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrolimex Petrochemical position performs unexpectedly, PetroVietnam Transportation 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 PetroVietnam Transportation will offset losses from the drop in PetroVietnam Transportation's long position.| Petrolimex Petrochemical vs. FIT INVEST JSC | Petrolimex Petrochemical vs. Damsan JSC | Petrolimex Petrochemical vs. An Phat Plastic | Petrolimex Petrochemical vs. APG Securities Joint |
| PetroVietnam Transportation vs. FIT INVEST JSC | PetroVietnam Transportation vs. Damsan JSC | PetroVietnam Transportation vs. An Phat Plastic | PetroVietnam Transportation vs. APG Securities Joint |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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