Correlation Between Petrovietnam Technical and Construction JSC
Can any of the company-specific risk be diversified away by investing in both Petrovietnam Technical and Construction JSC 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 Petrovietnam Technical and Construction JSC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petrovietnam Technical Services and Construction JSC No5, you can compare the effects of market volatilities on Petrovietnam Technical and Construction JSC 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 Petrovietnam Technical with a short position of Construction JSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrovietnam Technical and Construction JSC.
Diversification Opportunities for Petrovietnam Technical and Construction JSC
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Petrovietnam and Construction is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Petrovietnam Technical Service and Construction JSC No5 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Construction JSC No5 and Petrovietnam Technical 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 Petrovietnam Technical Services are associated (or correlated) with Construction JSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Construction JSC No5 has no effect on the direction of Petrovietnam Technical i.e., Petrovietnam Technical and Construction JSC go up and down completely randomly.
Pair Corralation between Petrovietnam Technical and Construction JSC
Assuming the 90 days trading horizon Petrovietnam Technical Services is expected to generate 0.35 times more return on investment than Construction JSC. However, Petrovietnam Technical Services is 2.85 times less risky than Construction JSC. It trades about -0.06 of its potential returns per unit of risk. Construction JSC No5 is currently generating about -0.26 per unit of risk. If you would invest 3,370,000 in Petrovietnam Technical Services on October 25, 2024 and sell it today you would lose (60,000) from holding Petrovietnam Technical Services or give up 1.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 42.86% |
| Values | Daily Returns |
Petrovietnam Technical Service vs. Construction JSC No5
Performance |
| Timeline |
| Petrovietnam Technical |
| Construction JSC No5 |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Petrovietnam Technical and Construction JSC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petrovietnam Technical and Construction JSC
The main advantage of trading using opposite Petrovietnam Technical and Construction JSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrovietnam Technical position performs unexpectedly, Construction JSC 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 Construction JSC will offset losses from the drop in Construction JSC's long position.| Petrovietnam Technical vs. FIT INVEST JSC | Petrovietnam Technical vs. Damsan JSC | Petrovietnam Technical vs. An Phat Plastic | Petrovietnam Technical vs. APG Securities Joint |
| Construction JSC vs. FIT INVEST JSC | Construction JSC vs. Damsan JSC | Construction JSC vs. An Phat Plastic | Construction JSC 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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