Correlation Between Binh Duong and Vina2 Investment
Can any of the company-specific risk be diversified away by investing in both Binh Duong and Vina2 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 Vina2 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 Vina2 Investment and, you can compare the effects of market volatilities on Binh Duong and Vina2 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 Vina2 Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Duong and Vina2 Investment.
Diversification Opportunities for Binh Duong and Vina2 Investment
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Binh and Vina2 is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Binh Duong Construction and Vina2 Investment and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vina2 Investment 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 Vina2 Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vina2 Investment has no effect on the direction of Binh Duong i.e., Binh Duong and Vina2 Investment go up and down completely randomly.
Pair Corralation between Binh Duong and Vina2 Investment
Assuming the 90 days trading horizon Binh Duong Construction is expected to generate 0.65 times more return on investment than Vina2 Investment. However, Binh Duong Construction is 1.55 times less risky than Vina2 Investment. It trades about 0.45 of its potential returns per unit of risk. Vina2 Investment and is currently generating about -0.11 per unit of risk. If you would invest 594,000 in Binh Duong Construction on September 2, 2024 and sell it today you would earn a total of 99,000 from holding Binh Duong Construction or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Binh Duong Construction vs. Vina2 Investment and
Performance |
| Timeline |
| Binh Duong Construction |
| Vina2 Investment |
Binh Duong and Vina2 Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Duong and Vina2 Investment
The main advantage of trading using opposite Binh Duong and Vina2 Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Duong position performs unexpectedly, Vina2 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 Vina2 Investment will offset losses from the drop in Vina2 Investment'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 |
| Vina2 Investment vs. FIT INVEST JSC | Vina2 Investment vs. Damsan JSC | Vina2 Investment vs. An Phat Plastic | Vina2 Investment 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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