Correlation Between PETRONAS Gas and US Global
Can any of the company-specific risk be diversified away by investing in both PETRONAS Gas and US Global 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 PETRONAS Gas and US Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PETRONAS Gas Berhad and US Global Investors, you can compare the effects of market volatilities on PETRONAS Gas and US Global 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 PETRONAS Gas with a short position of US Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of PETRONAS Gas and US Global.
Diversification Opportunities for PETRONAS Gas and US Global
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PETRONAS and GROW is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding PETRONAS Gas Berhad and US Global Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Global Investors and PETRONAS Gas 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 PETRONAS Gas Berhad are associated (or correlated) with US Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Global Investors has no effect on the direction of PETRONAS Gas i.e., PETRONAS Gas and US Global go up and down completely randomly.
Pair Corralation between PETRONAS Gas and US Global
Assuming the 90 days horizon PETRONAS Gas Berhad is expected to generate 3.17 times more return on investment than US Global. However, PETRONAS Gas is 3.17 times more volatile than US Global Investors. It trades about 0.05 of its potential returns per unit of risk. US Global Investors is currently generating about 0.0 per unit of risk. If you would invest 274.00 in PETRONAS Gas Berhad on September 3, 2024 and sell it today you would earn a total of 126.00 from holding PETRONAS Gas Berhad or generate 45.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 58.18% |
| Values | Daily Returns |
PETRONAS Gas Berhad vs. US Global Investors
Performance |
| Timeline |
| PETRONAS Gas Berhad |
| US Global Investors |
PETRONAS Gas and US Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PETRONAS Gas and US Global
The main advantage of trading using opposite PETRONAS Gas and US Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PETRONAS Gas position performs unexpectedly, US Global 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 US Global will offset losses from the drop in US Global's long position.| PETRONAS Gas vs. US Global Investors | PETRONAS Gas vs. Alvotech | PETRONAS Gas vs. Xponential Fitness | PETRONAS Gas vs. Valneva SE ADR |
| US Global vs. Gladstone Investment | US Global vs. PennantPark Floating Rate | US Global vs. Horizon Technology Finance | US Global vs. Stellus Capital Investment |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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