Correlation Between An Phat and Viet Thanh

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both An Phat and Viet 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 Viet 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 Viet Thanh Plastic, you can compare the effects of market volatilities on An Phat and Viet 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 Viet Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Viet Thanh.

Diversification Opportunities for An Phat and Viet Thanh

0.35
  Correlation Coefficient

Weak diversification

The 3 months correlation between AAA and Viet is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Viet Thanh Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viet Thanh 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 Viet Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viet Thanh Plastic has no effect on the direction of An Phat i.e., An Phat and Viet Thanh go up and down completely randomly.

Pair Corralation between An Phat and Viet Thanh

Assuming the 90 days trading horizon An Phat is expected to generate 8.18 times less return on investment than Viet Thanh. But when comparing it to its historical volatility, An Phat Plastic is 1.22 times less risky than Viet Thanh. It trades about 0.01 of its potential returns per unit of risk. Viet Thanh Plastic is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  890,000  in Viet Thanh Plastic on November 1, 2024 and sell it today you would earn a total of  850,000  from holding Viet Thanh Plastic or generate 95.51% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy99.19%
ValuesDaily Returns

An Phat Plastic  vs.  Viet Thanh Plastic

 Performance 
       Timeline  
An Phat Plastic 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days An Phat Plastic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, An Phat is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
Viet Thanh Plastic 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Viet Thanh Plastic are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Viet Thanh may actually be approaching a critical reversion point that can send shares even higher in March 2025.

An Phat and Viet Thanh Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with An Phat and Viet Thanh

The main advantage of trading using opposite An Phat and Viet Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Viet 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 Viet Thanh will offset losses from the drop in Viet Thanh's long position.
The idea behind An Phat Plastic and Viet Thanh Plastic pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.

Other Complementary Tools

Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas