Correlation Between Alphanam and Southern Rubber
Can any of the company-specific risk be diversified away by investing in both Alphanam and Southern Rubber 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 Southern Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and Southern Rubber Industry, you can compare the effects of market volatilities on Alphanam and Southern Rubber 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 Southern Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and Southern Rubber.
Diversification Opportunities for Alphanam and Southern Rubber
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alphanam and Southern is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and Southern Rubber Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Rubber Industry 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 Southern Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Rubber Industry has no effect on the direction of Alphanam i.e., Alphanam and Southern Rubber go up and down completely randomly.
Pair Corralation between Alphanam and Southern Rubber
Assuming the 90 days trading horizon Alphanam ME is expected to under-perform the Southern Rubber. In addition to that, Alphanam is 1.41 times more volatile than Southern Rubber Industry. It trades about -0.07 of its total potential returns per unit of risk. Southern Rubber Industry is currently generating about 0.01 per unit of volatility. If you would invest 1,374,270 in Southern Rubber Industry on November 5, 2024 and sell it today you would earn a total of 60,730 from holding Southern Rubber Industry or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 65.43% |
| Values | Daily Returns |
Alphanam ME vs. Southern Rubber Industry
Performance |
| Timeline |
| Alphanam ME |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Southern Rubber Industry |
Alphanam and Southern Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and Southern Rubber
The main advantage of trading using opposite Alphanam and Southern Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, Southern Rubber 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 Southern Rubber will offset losses from the drop in Southern Rubber's long position.| Alphanam vs. Saigon Telecommunication Technologies | Alphanam vs. Elcom Technology Communications | Alphanam vs. Danang Education Investment | Alphanam vs. Thanh Dat Investment |
| Southern Rubber vs. Danang Education Investment | Southern Rubber vs. Tien Phong Plastic | Southern Rubber vs. Asia Pacific Investment | Southern Rubber vs. Post and Telecommunications |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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