Correlation Between An Phat and PC3 Investment
Can any of the company-specific risk be diversified away by investing in both An Phat and PC3 Investment 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 PC3 Investment 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 PC3 Investment JSC, you can compare the effects of market volatilities on An Phat and PC3 Investment 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 PC3 Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and PC3 Investment.
Diversification Opportunities for An Phat and PC3 Investment
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AAA and PC3 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and PC3 Investment JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PC3 Investment JSC 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 PC3 Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PC3 Investment JSC has no effect on the direction of An Phat i.e., An Phat and PC3 Investment go up and down completely randomly.
Pair Corralation between An Phat and PC3 Investment
Assuming the 90 days trading horizon An Phat Plastic is expected to generate 0.28 times more return on investment than PC3 Investment. However, An Phat Plastic is 3.54 times less risky than PC3 Investment. It trades about -0.15 of its potential returns per unit of risk. PC3 Investment JSC is currently generating about -0.06 per unit of risk. If you would invest 980,000 in An Phat Plastic on October 18, 2024 and sell it today you would lose (150,000) from holding An Phat Plastic or give up 15.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 62.35% |
| Values | Daily Returns |
An Phat Plastic vs. PC3 Investment JSC
Performance |
| Timeline |
| An Phat Plastic |
| PC3 Investment JSC |
An Phat and PC3 Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and PC3 Investment
The main advantage of trading using opposite An Phat and PC3 Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, PC3 Investment 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 PC3 Investment will offset losses from the drop in PC3 Investment's long position.| An Phat vs. Long Giang Investment | An Phat vs. Tng Investment And | An Phat vs. Bao Ngoc Investment | An Phat vs. Construction And Investment |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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