Correlation Between An Phat and Duc Thanh
Can any of the company-specific risk be diversified away by investing in both An Phat and Duc Thanh 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 An Phat and Duc Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between An Phat Plastic and Duc Thanh Wood, you can compare the effects of market volatilities on An Phat and Duc Thanh 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 An Phat with a short position of Duc Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Duc Thanh.
Diversification Opportunities for An Phat and Duc Thanh
Average diversification
The 3 months correlation between AAA and Duc is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Duc Thanh Wood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duc Thanh Wood and An Phat 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 An Phat Plastic are associated (or correlated) with Duc Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duc Thanh Wood has no effect on the direction of An Phat i.e., An Phat and Duc Thanh go up and down completely randomly.
Pair Corralation between An Phat and Duc Thanh
Assuming the 90 days trading horizon An Phat is expected to generate 3.97 times less return on investment than Duc Thanh. In addition to that, An Phat is 1.37 times more volatile than Duc Thanh Wood. It trades about 0.01 of its total potential returns per unit of risk. Duc Thanh Wood is currently generating about 0.07 per unit of volatility. If you would invest 2,074,598 in Duc Thanh Wood on August 25, 2024 and sell it today you would earn a total of 550,402 from holding Duc Thanh Wood or generate 26.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
An Phat Plastic vs. Duc Thanh Wood
Performance |
| Timeline |
| An Phat Plastic |
| Duc Thanh Wood |
An Phat and Duc Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and Duc Thanh
The main advantage of trading using opposite An Phat and Duc Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Duc Thanh 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 Duc Thanh will offset losses from the drop in Duc Thanh's long position.| An Phat vs. South Basic Chemicals | An Phat vs. Saigon Beer Alcohol | An Phat vs. Vietnam Petroleum Transport | An Phat vs. Fecon Mining JSC |
| Duc Thanh vs. FIT INVEST JSC | Duc Thanh vs. Damsan JSC | Duc Thanh vs. An Phat Plastic | Duc Thanh vs. APG Securities Joint |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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