Correlation Between An Phat and Tien Phong
Can any of the company-specific risk be diversified away by investing in both An Phat and Tien Phong 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 Tien Phong 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 Tien Phong Plastic, you can compare the effects of market volatilities on An Phat and Tien Phong 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 Tien Phong. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Tien Phong.
Diversification Opportunities for An Phat and Tien Phong
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AAA and Tien is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Tien Phong Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tien Phong Plastic 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 Tien Phong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tien Phong Plastic has no effect on the direction of An Phat i.e., An Phat and Tien Phong go up and down completely randomly.
Pair Corralation between An Phat and Tien Phong
Assuming the 90 days trading horizon An Phat Plastic is expected to generate 0.52 times more return on investment than Tien Phong. However, An Phat Plastic is 1.91 times less risky than Tien Phong. It trades about -0.05 of its potential returns per unit of risk. Tien Phong Plastic is currently generating about -0.13 per unit of risk. If you would invest 857,000 in An Phat Plastic on October 20, 2024 and sell it today you would lose (11,000) from holding An Phat Plastic or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
An Phat Plastic vs. Tien Phong Plastic
Performance |
| Timeline |
| An Phat Plastic |
| Tien Phong Plastic |
An Phat and Tien Phong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and Tien Phong
The main advantage of trading using opposite An Phat and Tien Phong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Tien Phong 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 Tien Phong will offset losses from the drop in Tien Phong's long position.| An Phat vs. Vinhomes JSC | An Phat vs. Pacific Petroleum Transportation | An Phat vs. Song Hong Construction | An Phat vs. Ducgiang Chemicals Detergent |
| Tien Phong vs. Da Nang Construction | Tien Phong vs. 1369 Construction JSC | Tien Phong vs. Hochiminh City Metal | Tien Phong vs. Transport and Industry |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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