Correlation Between Alphanam and Vien Dong
Can any of the company-specific risk be diversified away by investing in both Alphanam and Vien Dong 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 Vien Dong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphanam ME and Vien Dong Investment, you can compare the effects of market volatilities on Alphanam and Vien Dong 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 Vien Dong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and Vien Dong.
Diversification Opportunities for Alphanam and Vien Dong
Poor diversification
The 3 months correlation between Alphanam and Vien is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and Vien Dong Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vien Dong Investment 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 Vien Dong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vien Dong Investment has no effect on the direction of Alphanam i.e., Alphanam and Vien Dong go up and down completely randomly.
Pair Corralation between Alphanam and Vien Dong
Assuming the 90 days trading horizon Alphanam ME is expected to generate 1.38 times more return on investment than Vien Dong. However, Alphanam is 1.38 times more volatile than Vien Dong Investment. It trades about -0.08 of its potential returns per unit of risk. Vien Dong Investment is currently generating about -0.2 per unit of risk. If you would invest 510,000 in Alphanam ME on August 27, 2024 and sell it today you would lose (10,000) from holding Alphanam ME or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 50.0% |
| Values | Daily Returns |
Alphanam ME vs. Vien Dong Investment
Performance |
| Timeline |
| Alphanam ME |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Vien Dong Investment |
Alphanam and Vien Dong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphanam and Vien Dong
The main advantage of trading using opposite Alphanam and Vien Dong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphanam position performs unexpectedly, Vien Dong 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 Vien Dong will offset losses from the drop in Vien Dong's long position.| Alphanam vs. FIT INVEST JSC | Alphanam vs. Damsan JSC | Alphanam vs. An Phat Plastic | Alphanam vs. APG Securities Joint |
| Vien Dong vs. FIT INVEST JSC | Vien Dong vs. Damsan JSC | Vien Dong vs. An Phat Plastic | Vien Dong 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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