Correlation Between Damsan JSC and Kinh Bac
Can any of the company-specific risk be diversified away by investing in both Damsan JSC and Kinh Bac 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 Damsan JSC and Kinh Bac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Damsan JSC and Kinh Bac City, you can compare the effects of market volatilities on Damsan JSC and Kinh Bac 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 Damsan JSC with a short position of Kinh Bac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Damsan JSC and Kinh Bac.
Diversification Opportunities for Damsan JSC and Kinh Bac
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Damsan and Kinh is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Damsan JSC and Kinh Bac City in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinh Bac City and Damsan JSC 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 Damsan JSC are associated (or correlated) with Kinh Bac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinh Bac City has no effect on the direction of Damsan JSC i.e., Damsan JSC and Kinh Bac go up and down completely randomly.
Pair Corralation between Damsan JSC and Kinh Bac
Assuming the 90 days trading horizon Damsan JSC is expected to under-perform the Kinh Bac. But the stock apears to be less risky and, when comparing its historical volatility, Damsan JSC is 2.92 times less risky than Kinh Bac. The stock trades about -0.28 of its potential returns per unit of risk. The Kinh Bac City is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2,630,000 in Kinh Bac City on August 30, 2024 and sell it today you would earn a total of 150,000 from holding Kinh Bac City or generate 5.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Damsan JSC vs. Kinh Bac City
Performance |
| Timeline |
| Damsan JSC |
| Kinh Bac City |
Damsan JSC and Kinh Bac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Damsan JSC and Kinh Bac
The main advantage of trading using opposite Damsan JSC and Kinh Bac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Damsan JSC position performs unexpectedly, Kinh Bac 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 Kinh Bac will offset losses from the drop in Kinh Bac's long position.| Damsan JSC vs. FIT INVEST JSC | Damsan JSC vs. An Phat Plastic | Damsan JSC vs. APG Securities Joint | Damsan JSC vs. Binhthuan Agriculture Services |
| Kinh Bac vs. Elcom Technology Communications | Kinh Bac vs. Petrolimex Information Technology | Kinh Bac vs. Military Insurance Corp | Kinh Bac vs. Innovative Technology Development |
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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