Correlation Between Vietnam National and PVI Reinsurance
Can any of the company-specific risk be diversified away by investing in both Vietnam National and PVI Reinsurance 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 Vietnam National and PVI Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam National Reinsurance and PVI Reinsurance Corp, you can compare the effects of market volatilities on Vietnam National and PVI Reinsurance 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 Vietnam National with a short position of PVI Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam National and PVI Reinsurance.
Diversification Opportunities for Vietnam National and PVI Reinsurance
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vietnam and PVI is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam National Reinsurance and PVI Reinsurance Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PVI Reinsurance Corp and Vietnam National 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 Vietnam National Reinsurance are associated (or correlated) with PVI Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PVI Reinsurance Corp has no effect on the direction of Vietnam National i.e., Vietnam National and PVI Reinsurance go up and down completely randomly.
Pair Corralation between Vietnam National and PVI Reinsurance
Assuming the 90 days trading horizon Vietnam National Reinsurance is expected to generate 0.72 times more return on investment than PVI Reinsurance. However, Vietnam National Reinsurance is 1.39 times less risky than PVI Reinsurance. It trades about 0.0 of its potential returns per unit of risk. PVI Reinsurance Corp is currently generating about 0.0 per unit of risk. If you would invest 2,297,364 in Vietnam National Reinsurance on September 3, 2024 and sell it today you would lose (7,364) from holding Vietnam National Reinsurance or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 88.51% |
| Values | Daily Returns |
Vietnam National Reinsurance vs. PVI Reinsurance Corp
Performance |
| Timeline |
| Vietnam National Rei |
| PVI Reinsurance Corp |
Vietnam National and PVI Reinsurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vietnam National and PVI Reinsurance
The main advantage of trading using opposite Vietnam National and PVI Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam National position performs unexpectedly, PVI Reinsurance 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 PVI Reinsurance will offset losses from the drop in PVI Reinsurance's long position.| Vietnam National vs. FIT INVEST JSC | Vietnam National vs. Damsan JSC | Vietnam National vs. An Phat Plastic | Vietnam National vs. Alphanam ME |
| PVI Reinsurance vs. FIT INVEST JSC | PVI Reinsurance vs. Damsan JSC | PVI Reinsurance vs. An Phat Plastic | PVI Reinsurance vs. Alphanam ME |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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