Correlation Between Alphanam and Plastic Additives
Can any of the company-specific risk be diversified away by investing in both Alphanam and Plastic Additives 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 Plastic Additives into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and Plastic Additives JSC, you can compare the effects of market volatilities on Alphanam and Plastic Additives 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 Plastic Additives. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and Plastic Additives.
Diversification Opportunities for Alphanam and Plastic Additives
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alphanam and Plastic is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and Plastic Additives JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plastic Additives JSC 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 Plastic Additives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plastic Additives JSC has no effect on the direction of Alphanam i.e., Alphanam and Plastic Additives go up and down completely randomly.
Pair Corralation between Alphanam and Plastic Additives
Assuming the 90 days trading horizon Alphanam ME is expected to under-perform the Plastic Additives. But the stock apears to be less risky and, when comparing its historical volatility, Alphanam ME is 1.16 times less risky than Plastic Additives. The stock trades about -0.07 of its potential returns per unit of risk. The Plastic Additives JSC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 740,000 in Plastic Additives JSC on September 2, 2024 and sell it today you would earn a total of 240,000 from holding Plastic Additives JSC or generate 32.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 71.31% |
| Values | Daily Returns |
Alphanam ME vs. Plastic Additives JSC
Performance |
| Timeline |
| Alphanam ME |
| Plastic Additives JSC |
Alphanam and Plastic Additives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and Plastic Additives
The main advantage of trading using opposite Alphanam and Plastic Additives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, Plastic Additives 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 Plastic Additives will offset losses from the drop in Plastic Additives' long position.| Alphanam vs. FIT INVEST JSC | Alphanam vs. Damsan JSC | Alphanam vs. An Phat Plastic | Alphanam vs. APG Securities Joint |
| Plastic Additives vs. Song Hong Garment | Plastic Additives vs. Alphanam ME | Plastic Additives vs. Hochiminh City Metal | Plastic Additives vs. Atesco Industrial Cartering |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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