Correlation Between Alphanam and Transport
Can any of the company-specific risk be diversified away by investing in both Alphanam and Transport 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 Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and Transport and Industry, you can compare the effects of market volatilities on Alphanam and Transport 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 Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and Transport.
Diversification Opportunities for Alphanam and Transport
Poor diversification
The 3 months correlation between Alphanam and Transport is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and Transport and Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transport and 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 Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transport and Industry has no effect on the direction of Alphanam i.e., Alphanam and Transport go up and down completely randomly.
Pair Corralation between Alphanam and Transport
Assuming the 90 days trading horizon Alphanam ME is expected to under-perform the Transport. But the stock apears to be less risky and, when comparing its historical volatility, Alphanam ME is 1.03 times less risky than Transport. The stock trades about -0.07 of its potential returns per unit of risk. The Transport and Industry is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 480,000 in Transport and Industry on August 25, 2024 and sell it today you would lose (16,000) from holding Transport and Industry or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 54.55% |
| Values | Daily Returns |
Alphanam ME vs. Transport and Industry
Performance |
| Timeline |
| Alphanam ME |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Transport and Industry |
Alphanam and Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and Transport
The main advantage of trading using opposite Alphanam and Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, Transport 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 Transport will offset losses from the drop in Transport's long position.| Alphanam vs. Transport and Industry | Alphanam vs. Petrolimex Information Technology | Alphanam vs. PVI Reinsurance Corp | Alphanam vs. Japan Vietnam Medical |
| Transport vs. FIT INVEST JSC | Transport vs. Damsan JSC | Transport vs. An Phat Plastic | Transport 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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