Correlation Between Atesco Industrial and Hochiminh City
Can any of the company-specific risk be diversified away by investing in both Atesco Industrial and Hochiminh City 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 Atesco Industrial and Hochiminh City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atesco Industrial Cartering and Hochiminh City Metal, you can compare the effects of market volatilities on Atesco Industrial and Hochiminh City 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 Atesco Industrial with a short position of Hochiminh City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atesco Industrial and Hochiminh City.
Diversification Opportunities for Atesco Industrial and Hochiminh City
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Atesco and Hochiminh is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Atesco Industrial Cartering and Hochiminh City Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochiminh City Metal and Atesco Industrial 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 Atesco Industrial Cartering are associated (or correlated) with Hochiminh City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochiminh City Metal has no effect on the direction of Atesco Industrial i.e., Atesco Industrial and Hochiminh City go up and down completely randomly.
Pair Corralation between Atesco Industrial and Hochiminh City
Assuming the 90 days trading horizon Atesco Industrial Cartering is expected to generate 4.52 times more return on investment than Hochiminh City. However, Atesco Industrial is 4.52 times more volatile than Hochiminh City Metal. It trades about 0.02 of its potential returns per unit of risk. Hochiminh City Metal is currently generating about 0.02 per unit of risk. If you would invest 1,580,000 in Atesco Industrial Cartering on August 25, 2024 and sell it today you would lose (300,000) from holding Atesco Industrial Cartering or give up 18.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 37.32% |
| Values | Daily Returns |
Atesco Industrial Cartering vs. Hochiminh City Metal
Performance |
| Timeline |
| Atesco Industrial |
| Hochiminh City Metal |
Atesco Industrial and Hochiminh City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atesco Industrial and Hochiminh City
The main advantage of trading using opposite Atesco Industrial and Hochiminh City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atesco Industrial position performs unexpectedly, Hochiminh City 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 Hochiminh City will offset losses from the drop in Hochiminh City's long position.| Atesco Industrial vs. Idico JSC | Atesco Industrial vs. Hochiminh City Metal | Atesco Industrial vs. Danang Education Investment | Atesco Industrial vs. South Basic Chemicals |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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