Correlation Between Ben Thanh and PVI Reinsurance
Can any of the company-specific risk be diversified away by investing in both Ben Thanh 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 Ben Thanh and PVI Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ben Thanh Rubber and PVI Reinsurance Corp, you can compare the effects of market volatilities on Ben Thanh 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 Ben Thanh with a short position of PVI Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ben Thanh and PVI Reinsurance.
Diversification Opportunities for Ben Thanh and PVI Reinsurance
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ben and PVI is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ben Thanh Rubber 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 Ben Thanh 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 Ben Thanh Rubber 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 Ben Thanh i.e., Ben Thanh and PVI Reinsurance go up and down completely randomly.
Pair Corralation between Ben Thanh and PVI Reinsurance
Assuming the 90 days trading horizon Ben Thanh is expected to generate 2.21 times less return on investment than PVI Reinsurance. But when comparing it to its historical volatility, Ben Thanh Rubber is 2.41 times less risky than PVI Reinsurance. It trades about 0.03 of its potential returns per unit of risk. PVI Reinsurance Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,980,000 in PVI Reinsurance Corp on December 18, 2024 and sell it today you would earn a total of 50,000 from holding PVI Reinsurance Corp or generate 2.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 91.23% |
Values | Daily Returns |
Ben Thanh Rubber vs. PVI Reinsurance Corp
Performance |
Timeline |
Ben Thanh Rubber |
PVI Reinsurance Corp |
Ben Thanh and PVI Reinsurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ben Thanh and PVI Reinsurance
The main advantage of trading using opposite Ben Thanh and PVI Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ben Thanh 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.Ben Thanh vs. South Basic Chemicals | Ben Thanh vs. PV2 Investment JSC | Ben Thanh vs. Tien Giang Investment | Ben Thanh vs. Thu Duc TradingImport |
PVI Reinsurance vs. Hoang Huy Investment | PVI Reinsurance vs. Elcom Technology Communications | PVI Reinsurance vs. Vien Dong Investment | PVI Reinsurance vs. Techcom Vietnam REIT |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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