Correlation Between Agriculture Printing and Vietnam Petroleum
Can any of the company-specific risk be diversified away by investing in both Agriculture Printing and Vietnam Petroleum 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 Agriculture Printing and Vietnam Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agriculture Printing and and Vietnam Petroleum Transport, you can compare the effects of market volatilities on Agriculture Printing and Vietnam Petroleum 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 Agriculture Printing with a short position of Vietnam Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agriculture Printing and Vietnam Petroleum.
Diversification Opportunities for Agriculture Printing and Vietnam Petroleum
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Agriculture and Vietnam is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Agriculture Printing and and Vietnam Petroleum Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam Petroleum and Agriculture Printing 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 Agriculture Printing and are associated (or correlated) with Vietnam Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam Petroleum has no effect on the direction of Agriculture Printing i.e., Agriculture Printing and Vietnam Petroleum go up and down completely randomly.
Pair Corralation between Agriculture Printing and Vietnam Petroleum
Assuming the 90 days trading horizon Agriculture Printing is expected to generate 10.46 times less return on investment than Vietnam Petroleum. In addition to that, Agriculture Printing is 1.01 times more volatile than Vietnam Petroleum Transport. It trades about 0.01 of its total potential returns per unit of risk. Vietnam Petroleum Transport is currently generating about 0.09 per unit of volatility. If you would invest 1,295,000 in Vietnam Petroleum Transport on September 18, 2024 and sell it today you would earn a total of 115,000 from holding Vietnam Petroleum Transport or generate 8.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 87.5% |
Values | Daily Returns |
Agriculture Printing and vs. Vietnam Petroleum Transport
Performance |
Timeline |
Agriculture Printing and |
Vietnam Petroleum |
Agriculture Printing and Vietnam Petroleum Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Agriculture Printing and Vietnam Petroleum
The main advantage of trading using opposite Agriculture Printing and Vietnam Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agriculture Printing position performs unexpectedly, Vietnam Petroleum 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 Vietnam Petroleum will offset losses from the drop in Vietnam Petroleum's long position.Agriculture Printing vs. Sao Ta Foods | Agriculture Printing vs. Din Capital Investment | Agriculture Printing vs. PV2 Investment JSC | Agriculture Printing vs. Vu Dang 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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