Correlation Between PV2 Investment and Nafoods Group
Can any of the company-specific risk be diversified away by investing in both PV2 Investment and Nafoods Group 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 PV2 Investment and Nafoods Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PV2 Investment JSC and Nafoods Group JSC, you can compare the effects of market volatilities on PV2 Investment and Nafoods Group 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 PV2 Investment with a short position of Nafoods Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PV2 Investment and Nafoods Group.
Diversification Opportunities for PV2 Investment and Nafoods Group
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PV2 and Nafoods is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding PV2 Investment JSC and Nafoods Group JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nafoods Group JSC and PV2 Investment 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 PV2 Investment JSC are associated (or correlated) with Nafoods Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nafoods Group JSC has no effect on the direction of PV2 Investment i.e., PV2 Investment and Nafoods Group go up and down completely randomly.
Pair Corralation between PV2 Investment and Nafoods Group
Assuming the 90 days trading horizon PV2 Investment JSC is expected to under-perform the Nafoods Group. In addition to that, PV2 Investment is 2.28 times more volatile than Nafoods Group JSC. It trades about -0.05 of its total potential returns per unit of risk. Nafoods Group JSC is currently generating about 0.02 per unit of volatility. If you would invest 1,925,000 in Nafoods Group JSC on January 15, 2025 and sell it today you would earn a total of 20,000 from holding Nafoods Group JSC or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PV2 Investment JSC vs. Nafoods Group JSC
Performance |
| Timeline |
| PV2 Investment JSC |
| Nafoods Group JSC |
PV2 Investment and Nafoods Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PV2 Investment and Nafoods Group
The main advantage of trading using opposite PV2 Investment and Nafoods Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PV2 Investment position performs unexpectedly, Nafoods Group 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 Nafoods Group will offset losses from the drop in Nafoods Group's long position.| PV2 Investment vs. Telecoms Informatics JSC | PV2 Investment vs. Vien Dong Investment | PV2 Investment vs. Pha Le Plastics | PV2 Investment vs. Vu Dang Investment |
| Nafoods Group vs. SMC Investment Trading | Nafoods Group vs. LDG Investment JSC | Nafoods Group vs. Sao Ta Foods | Nafoods Group vs. TDG Global 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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