Correlation Between Binh Duong and Sea Air
Can any of the company-specific risk be diversified away by investing in both Binh Duong and Sea Air 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 Binh Duong and Sea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binh Duong Construction and Sea Air Freight, you can compare the effects of market volatilities on Binh Duong and Sea Air 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 Binh Duong with a short position of Sea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Duong and Sea Air.
Diversification Opportunities for Binh Duong and Sea Air
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Binh and Sea is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Binh Duong Construction and Sea Air Freight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea Air Freight and Binh Duong 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 Binh Duong Construction are associated (or correlated) with Sea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea Air Freight has no effect on the direction of Binh Duong i.e., Binh Duong and Sea Air go up and down completely randomly.
Pair Corralation between Binh Duong and Sea Air
Assuming the 90 days trading horizon Binh Duong Construction is expected to generate 1.05 times more return on investment than Sea Air. However, Binh Duong is 1.05 times more volatile than Sea Air Freight. It trades about 0.02 of its potential returns per unit of risk. Sea Air Freight is currently generating about 0.0 per unit of risk. If you would invest 655,000 in Binh Duong Construction on August 31, 2024 and sell it today you would earn a total of 29,000 from holding Binh Duong Construction or generate 4.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.62% |
| Values | Daily Returns |
Binh Duong Construction vs. Sea Air Freight
Performance |
| Timeline |
| Binh Duong Construction |
| Sea Air Freight |
Binh Duong and Sea Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Duong and Sea Air
The main advantage of trading using opposite Binh Duong and Sea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Duong position performs unexpectedly, Sea Air 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 Sea Air will offset losses from the drop in Sea Air's long position.| Binh Duong vs. FIT INVEST JSC | Binh Duong vs. Damsan JSC | Binh Duong vs. An Phat Plastic | Binh Duong vs. Alphanam ME |
| Sea Air vs. Saigon Beer Alcohol | Sea Air vs. SCG Construction JSC | Sea Air vs. Hung Hau Agricultural | Sea Air vs. Vietnam Petroleum Transport |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |