Correlation Between Petrovietnam Drilling and Hai Phong

Can any of the company-specific risk be diversified away by investing in both Petrovietnam Drilling and Hai Phong 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 Drilling and Hai Phong into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Petrovietnam Drilling Mud and Hai Phong Thermal, you can compare the effects of market volatilities on Petrovietnam Drilling and Hai Phong 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 Drilling with a short position of Hai Phong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petrovietnam Drilling and Hai Phong.

Diversification Opportunities for Petrovietnam Drilling and Hai Phong

0.0

Correlation Coefficient

Petrovietnam Drilling  Hai Phong

Pay attention - limited upside

The 3 months correlation between Petrovietnam and Hai is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Petrovietnam Drilling Mud and Hai Phong Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hai Phong Thermal and Petrovietnam Drilling 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 Drilling Mud are associated (or correlated) with Hai Phong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hai Phong Thermal has no effect on the direction of Petrovietnam Drilling i.e., Petrovietnam Drilling and Hai Phong go up and down completely randomly.

Pair Corralation between Petrovietnam Drilling and Hai Phong

If you would invest (100.00) in Hai Phong Thermal on September 29, 2024 and sell it today you would earn a total of  100.00  from holding Hai Phong Thermal or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Petrovietnam Drilling Mud  vs.  Hai Phong Thermal

Petrovietnam Drilling Mud

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Petrovietnam Drilling Mud has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Hai Phong Thermal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hai Phong Thermal has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Hai Phong is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Petrovietnam Drilling and Hai Phong

The main advantage of trading using opposite Petrovietnam Drilling and Hai Phong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petrovietnam Drilling position performs unexpectedly, Hai Phong 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 Hai Phong will offset losses from the drop in Hai Phong's long position.

The idea behind Petrovietnam Drilling Mud and Hai Phong Thermal pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Commodity Directory module to find actively traded commodities issued by global exchanges.