Correlation Between AgriBank Securities and Truong Thanh
Can any of the company-specific risk be diversified away by investing in both AgriBank Securities and Truong 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 AgriBank Securities and Truong Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AgriBank Securities JSC and Truong Thanh Furniture, you can compare the effects of market volatilities on AgriBank Securities and Truong 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 AgriBank Securities with a short position of Truong Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of AgriBank Securities and Truong Thanh.
Diversification Opportunities for AgriBank Securities and Truong Thanh
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AgriBank and Truong is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding AgriBank Securities JSC and Truong Thanh Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Truong Thanh Furniture and AgriBank Securities 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 AgriBank Securities JSC are associated (or correlated) with Truong Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Truong Thanh Furniture has no effect on the direction of AgriBank Securities i.e., AgriBank Securities and Truong Thanh go up and down completely randomly.
Pair Corralation between AgriBank Securities and Truong Thanh
Assuming the 90 days trading horizon AgriBank Securities JSC is expected to under-perform the Truong Thanh. But the stock apears to be less risky and, when comparing its historical volatility, AgriBank Securities JSC is 1.06 times less risky than Truong Thanh. The stock trades about -0.09 of its potential returns per unit of risk. The Truong Thanh Furniture is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 306,000 in Truong Thanh Furniture on August 31, 2024 and sell it today you would lose (3,000) from holding Truong Thanh Furniture or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AgriBank Securities JSC vs. Truong Thanh Furniture
Performance |
| Timeline |
| AgriBank Securities JSC |
| Truong Thanh Furniture |
AgriBank Securities and Truong Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AgriBank Securities and Truong Thanh
The main advantage of trading using opposite AgriBank Securities and Truong Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AgriBank Securities position performs unexpectedly, Truong 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 Truong Thanh will offset losses from the drop in Truong Thanh's long position.| AgriBank Securities vs. FIT INVEST JSC | AgriBank Securities vs. Damsan JSC | AgriBank Securities vs. An Phat Plastic | AgriBank Securities vs. Alphanam ME |
| Truong Thanh vs. Elcom Technology Communications | Truong Thanh vs. Post and Telecommunications | Truong Thanh vs. Petrovietnam Drilling Mud | Truong Thanh vs. Industrial Urban 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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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