Correlation Between Binh Duong and SMC Investment
Can any of the company-specific risk be diversified away by investing in both Binh Duong and SMC Investment 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 SMC Investment 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 SMC Investment Trading, you can compare the effects of market volatilities on Binh Duong and SMC Investment 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 SMC Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Duong and SMC Investment.
Diversification Opportunities for Binh Duong and SMC Investment
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Binh and SMC is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Binh Duong Construction and SMC Investment Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMC Investment Trading 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 SMC Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMC Investment Trading has no effect on the direction of Binh Duong i.e., Binh Duong and SMC Investment go up and down completely randomly.
Pair Corralation between Binh Duong and SMC Investment
Assuming the 90 days trading horizon Binh Duong Construction is expected to generate 0.57 times more return on investment than SMC Investment. However, Binh Duong Construction is 1.77 times less risky than SMC Investment. It trades about 0.06 of its potential returns per unit of risk. SMC Investment Trading is currently generating about -0.01 per unit of risk. If you would invest 606,000 in Binh Duong Construction on October 30, 2024 and sell it today you would earn a total of 344,000 from holding Binh Duong Construction or generate 56.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binh Duong Construction vs. SMC Investment Trading
Performance |
| Timeline |
| Binh Duong Construction |
| SMC Investment Trading |
Binh Duong and SMC Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Duong and SMC Investment
The main advantage of trading using opposite Binh Duong and SMC Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Duong position performs unexpectedly, SMC Investment 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 SMC Investment will offset losses from the drop in SMC Investment's long position.| Binh Duong vs. Nafoods Group JSC | Binh Duong vs. Hochiminh City Metal | Binh Duong vs. PostTelecommunication Equipment | Binh Duong vs. VietinBank Securities JSC |
| SMC Investment vs. TDT Investment and | SMC Investment vs. Vincom Retail JSC | SMC Investment vs. Dinhvu Port Investment | SMC Investment vs. Japan Vietnam Medical |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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