Correlation Between Alphanam and Ben Thanh
Can any of the company-specific risk be diversified away by investing in both Alphanam and Ben 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 Alphanam and Ben Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and Ben Thanh Rubber, you can compare the effects of market volatilities on Alphanam and Ben 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 Alphanam with a short position of Ben Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and Ben Thanh.
Diversification Opportunities for Alphanam and Ben Thanh
Pay attention - limited upside
The 3 months correlation between Alphanam and Ben is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and Ben Thanh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ben Thanh Rubber and Alphanam 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 Alphanam ME are associated (or correlated) with Ben Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ben Thanh Rubber has no effect on the direction of Alphanam i.e., Alphanam and Ben Thanh go up and down completely randomly.
Pair Corralation between Alphanam and Ben Thanh
Assuming the 90 days trading horizon Alphanam ME is expected to under-perform the Ben Thanh. In addition to that, Alphanam is 1.96 times more volatile than Ben Thanh Rubber. It trades about -0.08 of its total potential returns per unit of risk. Ben Thanh Rubber is currently generating about 0.23 per unit of volatility. If you would invest 1,335,000 in Ben Thanh Rubber on August 28, 2024 and sell it today you would earn a total of 75,000 from holding Ben Thanh Rubber or generate 5.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 47.62% |
| Values | Daily Returns |
Alphanam ME vs. Ben Thanh Rubber
Performance |
| Timeline |
| Alphanam ME |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ben Thanh Rubber |
Alphanam and Ben Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and Ben Thanh
The main advantage of trading using opposite Alphanam and Ben Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, Ben 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 Ben Thanh will offset losses from the drop in Ben Thanh's long position.| Alphanam vs. FIT INVEST JSC | Alphanam vs. Damsan JSC | Alphanam vs. An Phat Plastic | Alphanam vs. APG Securities Joint |
| Ben Thanh vs. FIT INVEST JSC | Ben Thanh vs. Damsan JSC | Ben Thanh vs. An Phat Plastic | Ben Thanh vs. APG Securities Joint |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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