Correlation Between PetroVietnam Transportation and Innovative Technology
Can any of the company-specific risk be diversified away by investing in both PetroVietnam Transportation and Innovative Technology 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 Transportation and Innovative Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PetroVietnam Transportation Corp and Innovative Technology Development, you can compare the effects of market volatilities on PetroVietnam Transportation and Innovative Technology 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 Transportation with a short position of Innovative Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroVietnam Transportation and Innovative Technology.
Diversification Opportunities for PetroVietnam Transportation and Innovative Technology
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between PetroVietnam and Innovative is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding PetroVietnam Transportation Co and Innovative Technology Developm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovative Technology and PetroVietnam Transportation 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 Transportation Corp are associated (or correlated) with Innovative Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovative Technology has no effect on the direction of PetroVietnam Transportation i.e., PetroVietnam Transportation and Innovative Technology go up and down completely randomly.
Pair Corralation between PetroVietnam Transportation and Innovative Technology
Assuming the 90 days trading horizon PetroVietnam Transportation Corp is expected to generate 0.5 times more return on investment than Innovative Technology. However, PetroVietnam Transportation Corp is 2.01 times less risky than Innovative Technology. It trades about -0.08 of its potential returns per unit of risk. Innovative Technology Development is currently generating about -0.09 per unit of risk. If you would invest 2,755,000 in PetroVietnam Transportation Corp on September 2, 2024 and sell it today you would lose (55,000) from holding PetroVietnam Transportation Corp or give up 2.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroVietnam Transportation Co vs. Innovative Technology Developm
Performance |
| Timeline |
| PetroVietnam Transportation |
| Innovative Technology |
PetroVietnam Transportation and Innovative Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroVietnam Transportation and Innovative Technology
The main advantage of trading using opposite PetroVietnam Transportation and Innovative Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroVietnam Transportation position performs unexpectedly, Innovative Technology 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 Innovative Technology will offset losses from the drop in Innovative Technology's long position.| PetroVietnam Transportation vs. Da Nang Construction | PetroVietnam Transportation vs. Danang Rubber JSC | PetroVietnam Transportation vs. Thong Nhat Rubber | PetroVietnam Transportation vs. Dong Nai Plastic |
| Innovative Technology vs. Saigon Viendong Technology | Innovative Technology vs. Techcom Vietnam REIT | Innovative Technology vs. Sea Air Freight | Innovative Technology vs. Century Synthetic Fiber |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |