Correlation Between An Phat and IDJ FINANCIAL
Can any of the company-specific risk be diversified away by investing in both An Phat and IDJ FINANCIAL 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 IDJ FINANCIAL 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 IDJ FINANCIAL, you can compare the effects of market volatilities on An Phat and IDJ FINANCIAL 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 IDJ FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and IDJ FINANCIAL.
Diversification Opportunities for An Phat and IDJ FINANCIAL
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AAA and IDJ is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and IDJ FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDJ FINANCIAL 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 IDJ FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDJ FINANCIAL has no effect on the direction of An Phat i.e., An Phat and IDJ FINANCIAL go up and down completely randomly.
Pair Corralation between An Phat and IDJ FINANCIAL
Assuming the 90 days trading horizon An Phat Plastic is expected to under-perform the IDJ FINANCIAL. In addition to that, An Phat is 1.04 times more volatile than IDJ FINANCIAL. It trades about -0.12 of its total potential returns per unit of risk. IDJ FINANCIAL is currently generating about -0.08 per unit of volatility. If you would invest 620,000 in IDJ FINANCIAL on August 31, 2024 and sell it today you would lose (20,000) from holding IDJ FINANCIAL or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
An Phat Plastic vs. IDJ FINANCIAL
Performance |
| Timeline |
| An Phat Plastic |
| IDJ FINANCIAL |
An Phat and IDJ FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and IDJ FINANCIAL
The main advantage of trading using opposite An Phat and IDJ FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, IDJ FINANCIAL 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 IDJ FINANCIAL will offset losses from the drop in IDJ FINANCIAL's long position.| An Phat vs. Dong A Hotel | An Phat vs. Military Insurance Corp | An Phat vs. Vinhomes JSC | An Phat vs. Techcom Vietnam REIT |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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