Correlation Between Binh Duong and Transport
Can any of the company-specific risk be diversified away by investing in both Binh Duong and Transport 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 Transport 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 Transport and Industry, you can compare the effects of market volatilities on Binh Duong and Transport 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 Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Duong and Transport.
Diversification Opportunities for Binh Duong and Transport
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Binh and Transport is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Binh Duong Construction and Transport and Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transport and Industry 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 Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transport and Industry has no effect on the direction of Binh Duong i.e., Binh Duong and Transport go up and down completely randomly.
Pair Corralation between Binh Duong and Transport
Assuming the 90 days trading horizon Binh Duong Construction is expected to generate 0.8 times more return on investment than Transport. However, Binh Duong Construction is 1.26 times less risky than Transport. It trades about 0.51 of its potential returns per unit of risk. Transport and Industry is currently generating about -0.12 per unit of risk. If you would invest 580,000 in Binh Duong Construction on September 1, 2024 and sell it today you would earn a total of 113,000 from holding Binh Duong Construction or generate 19.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binh Duong Construction vs. Transport and Industry
Performance |
| Timeline |
| Binh Duong Construction |
| Transport and Industry |
Binh Duong and Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Duong and Transport
The main advantage of trading using opposite Binh Duong and Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Duong position performs unexpectedly, Transport 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 Transport will offset losses from the drop in Transport'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 |
| Transport vs. FIT INVEST JSC | Transport vs. Damsan JSC | Transport vs. An Phat Plastic | Transport vs. Alphanam ME |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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