Correlation Between An Phat and Binh Thanh
Can any of the company-specific risk be diversified away by investing in both An Phat and Binh 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 Binh 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 Binh Thanh Import, you can compare the effects of market volatilities on An Phat and Binh 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 Binh Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Binh Thanh.
Diversification Opportunities for An Phat and Binh Thanh
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AAA and Binh is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Binh Thanh Import in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Thanh Import 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 Binh Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binh Thanh Import has no effect on the direction of An Phat i.e., An Phat and Binh Thanh go up and down completely randomly.
Pair Corralation between An Phat and Binh Thanh
Assuming the 90 days trading horizon An Phat Plastic is expected to generate 0.24 times more return on investment than Binh Thanh. However, An Phat Plastic is 4.21 times less risky than Binh Thanh. It trades about -0.17 of its potential returns per unit of risk. Binh Thanh Import is currently generating about -0.13 per unit of risk. If you would invest 909,000 in An Phat Plastic on August 30, 2024 and sell it today you would lose (59,000) from holding An Phat Plastic or give up 6.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
An Phat Plastic vs. Binh Thanh Import
Performance |
| Timeline |
| An Phat Plastic |
| Binh Thanh Import |
An Phat and Binh Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and Binh Thanh
The main advantage of trading using opposite An Phat and Binh Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Binh 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 Binh Thanh will offset losses from the drop in Binh Thanh's long position.| An Phat vs. FIT INVEST JSC | An Phat vs. Damsan JSC | An Phat vs. APG Securities Joint | An Phat vs. Binhthuan Agriculture Services |
| Binh Thanh vs. FIT INVEST JSC | Binh Thanh vs. Damsan JSC | Binh Thanh vs. An Phat Plastic | Binh 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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