Correlation Between Petro Usa and SavMobi Technology

Can any of the company-specific risk be diversified away by investing in both Petro Usa and SavMobi Technology 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 Petro Usa and SavMobi Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Petro Usa and SavMobi Technology, you can compare the effects of market volatilities on Petro Usa and SavMobi Technology 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 Petro Usa with a short position of SavMobi Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petro Usa and SavMobi Technology.

Diversification Opportunities for Petro Usa and SavMobi Technology

0.0

Correlation Coefficient

Petro Usa  SavMobi Technology

Pay attention - limited upside

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

Pair Corralation between Petro Usa and SavMobi Technology

Given the investment horizon of 90 days Petro Usa is expected to generate 1.37 times more return on investment than SavMobi Technology. However, Petro Usa is 1.37 times more volatile than SavMobi Technology. It trades about 0.06 of its potential returns per unit of risk. SavMobi Technology is currently generating about -0.06 per unit of risk. If you would invest  400.00  in Petro Usa on October 5, 2024 and sell it today you would earn a total of  100.00  from holding Petro Usa or generate 25.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.68%
Values	Daily Returns

Petro Usa  vs.  SavMobi Technology

Petro Usa

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Petro Usa has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady basic indicators, Petro Usa is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

SavMobi Technology

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SavMobi Technology are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, SavMobi Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Petro Usa and SavMobi Technology

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

The idea behind Petro Usa and SavMobi Technology 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.