Correlation Between An Phat and Thong Nhat
Can any of the company-specific risk be diversified away by investing in both An Phat and Thong Nhat 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 Thong Nhat 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 Thong Nhat Rubber, you can compare the effects of market volatilities on An Phat and Thong Nhat 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 Thong Nhat. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Thong Nhat.
Diversification Opportunities for An Phat and Thong Nhat
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AAA and Thong is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Thong Nhat Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thong Nhat Rubber 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 Thong Nhat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thong Nhat Rubber has no effect on the direction of An Phat i.e., An Phat and Thong Nhat go up and down completely randomly.
Pair Corralation between An Phat and Thong Nhat
Assuming the 90 days trading horizon An Phat Plastic is expected to generate 0.29 times more return on investment than Thong Nhat. However, An Phat Plastic is 3.4 times less risky than Thong Nhat. It trades about 0.1 of its potential returns per unit of risk. Thong Nhat Rubber is currently generating about -0.11 per unit of risk. If you would invest 827,000 in An Phat Plastic on September 3, 2024 and sell it today you would earn a total of 21,000 from holding An Phat Plastic or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 47.62% |
| Values | Daily Returns |
An Phat Plastic vs. Thong Nhat Rubber
Performance |
| Timeline |
| An Phat Plastic |
| Thong Nhat Rubber |
An Phat and Thong Nhat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with An Phat and Thong Nhat
The main advantage of trading using opposite An Phat and Thong Nhat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Thong Nhat 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 Thong Nhat will offset losses from the drop in Thong Nhat's long position.| An Phat vs. FIT INVEST JSC | An Phat vs. Damsan JSC | An Phat vs. Alphanam ME | An Phat vs. APG Securities Joint |
| Thong Nhat vs. Nafoods Group JSC | Thong Nhat vs. Vietnam Rubber Group | Thong Nhat vs. Dong Nai Plastic | Thong Nhat vs. Sao Vang Rubber |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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