Correlation Between Post and International Gas
Can any of the company-specific risk be diversified away by investing in both Post and International Gas 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 Post and International Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Post and Telecommunications and International Gas Product, you can compare the effects of market volatilities on Post and International Gas 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 Post with a short position of International Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Post and International Gas.
Diversification Opportunities for Post and International Gas
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Post and International is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Post and Telecommunications and International Gas Product in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Gas Product and Post 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 Post and Telecommunications are associated (or correlated) with International Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Gas Product has no effect on the direction of Post i.e., Post and International Gas go up and down completely randomly.
Pair Corralation between Post and International Gas
Assuming the 90 days trading horizon Post and Telecommunications is expected to generate 0.66 times more return on investment than International Gas. However, Post and Telecommunications is 1.51 times less risky than International Gas. It trades about -0.06 of its potential returns per unit of risk. International Gas Product is currently generating about -0.05 per unit of risk. If you would invest 824,000 in Post and Telecommunications on September 12, 2024 and sell it today you would lose (355,000) from holding Post and Telecommunications or give up 43.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Post and Telecommunications vs. International Gas Product
Performance |
| Timeline |
| Post and Telecommuni |
| International Gas Product |
Post and International Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Post and International Gas
The main advantage of trading using opposite Post and International Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Post position performs unexpectedly, International Gas 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 International Gas will offset losses from the drop in International Gas' long position.The idea behind Post and Telecommunications and International Gas Product pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| International Gas vs. Post and Telecommunications | International Gas vs. Vietnam Petroleum Transport | International Gas vs. PostTelecommunication Equipment | International Gas vs. FPT Digital Retail |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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