Correlation Between Vietnam Petroleum and Saigon Beer
Can any of the company-specific risk be diversified away by investing in both Vietnam Petroleum and Saigon Beer 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 Petroleum and Saigon Beer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam Petroleum Transport and Saigon Beer Alcohol, you can compare the effects of market volatilities on Vietnam Petroleum and Saigon Beer 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 Petroleum with a short position of Saigon Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam Petroleum and Saigon Beer.
Diversification Opportunities for Vietnam Petroleum and Saigon Beer
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Vietnam and Saigon is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Petroleum Transport and Saigon Beer Alcohol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Beer Alcohol and Vietnam Petroleum 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 Petroleum Transport are associated (or correlated) with Saigon Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Beer Alcohol has no effect on the direction of Vietnam Petroleum i.e., Vietnam Petroleum and Saigon Beer go up and down completely randomly.
Pair Corralation between Vietnam Petroleum and Saigon Beer
Assuming the 90 days trading horizon Vietnam Petroleum Transport is expected to generate 2.1 times more return on investment than Saigon Beer. However, Vietnam Petroleum is 2.1 times more volatile than Saigon Beer Alcohol. It trades about 0.12 of its potential returns per unit of risk. Saigon Beer Alcohol is currently generating about 0.22 per unit of risk. If you would invest 1,380,000 in Vietnam Petroleum Transport on September 17, 2024 and sell it today you would earn a total of 55,000 from holding Vietnam Petroleum Transport or generate 3.99% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Vietnam Petroleum Transport vs. Saigon Beer Alcohol
Performance |
Timeline |
Vietnam Petroleum |
Saigon Beer Alcohol |
Vietnam Petroleum and Saigon Beer Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Vietnam Petroleum and Saigon Beer
The main advantage of trading using opposite Vietnam Petroleum and Saigon Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam Petroleum position performs unexpectedly, Saigon Beer 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 Saigon Beer will offset losses from the drop in Saigon Beer's long position.Vietnam Petroleum vs. PVI Reinsurance Corp | Vietnam Petroleum vs. Nafoods Group JSC | Vietnam Petroleum vs. Vietnam National Reinsurance | Vietnam Petroleum vs. CEO Group JSC |
Saigon Beer vs. Vietnam Petroleum Transport | Saigon Beer vs. Vietnam Airlines JSC | Saigon Beer vs. Vincom Retail JSC | Saigon Beer vs. Hanoi Beer Alcohol |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Commodity Directory Find actively traded commodities issued by global exchanges | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |