Correlation Between Alphanam and VINACONEX
Can any of the company-specific risk be diversified away by investing in both Alphanam and VINACONEX 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 VINACONEX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and VINACONEX 21, you can compare the effects of market volatilities on Alphanam and VINACONEX 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 VINACONEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and VINACONEX.
Diversification Opportunities for Alphanam and VINACONEX
Weak diversification
The 3 months correlation between Alphanam and VINACONEX is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and VINACONEX 21 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VINACONEX 21 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 VINACONEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VINACONEX 21 has no effect on the direction of Alphanam i.e., Alphanam and VINACONEX go up and down completely randomly.
Pair Corralation between Alphanam and VINACONEX
Assuming the 90 days trading horizon Alphanam ME is expected to under-perform the VINACONEX. In addition to that, Alphanam is 1.21 times more volatile than VINACONEX 21. It trades about -0.06 of its total potential returns per unit of risk. VINACONEX 21 is currently generating about 0.26 per unit of volatility. If you would invest 570,000 in VINACONEX 21 on September 5, 2024 and sell it today you would earn a total of 100,000 from holding VINACONEX 21 or generate 17.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 57.89% |
| Values | Daily Returns |
Alphanam ME vs. VINACONEX 21
Performance |
| Timeline |
| Alphanam ME |
| VINACONEX 21 |
Alphanam and VINACONEX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and VINACONEX
The main advantage of trading using opposite Alphanam and VINACONEX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, VINACONEX 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 VINACONEX will offset losses from the drop in VINACONEX's long position.| Alphanam vs. FIT INVEST JSC | Alphanam vs. Damsan JSC | Alphanam vs. An Phat Plastic | Alphanam vs. APG Securities Joint |
| VINACONEX vs. Alphanam ME | VINACONEX vs. Hochiminh City Metal | VINACONEX vs. Atesco Industrial Cartering | VINACONEX vs. Danang Education Investment |
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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