Correlation Between Hanoi Beer and An Phat
Can any of the company-specific risk be diversified away by investing in both Hanoi Beer and An Phat 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 Hanoi Beer and An Phat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanoi Beer Alcohol and An Phat Plastic, you can compare the effects of market volatilities on Hanoi Beer and An Phat 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 Hanoi Beer with a short position of An Phat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanoi Beer and An Phat.
Diversification Opportunities for Hanoi Beer and An Phat
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hanoi and AAA is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Hanoi Beer Alcohol and An Phat Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on An Phat Plastic and Hanoi Beer 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 Hanoi Beer Alcohol are associated (or correlated) with An Phat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of An Phat Plastic has no effect on the direction of Hanoi Beer i.e., Hanoi Beer and An Phat go up and down completely randomly.
Pair Corralation between Hanoi Beer and An Phat
Assuming the 90 days trading horizon Hanoi Beer Alcohol is expected to under-perform the An Phat. In addition to that, Hanoi Beer is 2.64 times more volatile than An Phat Plastic. It trades about -0.18 of its total potential returns per unit of risk. An Phat Plastic is currently generating about -0.23 per unit of volatility. If you would invest 860,000 in An Phat Plastic on November 5, 2024 and sell it today you would lose (24,000) from holding An Phat Plastic or give up 2.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.5% |
| Values | Daily Returns |
Hanoi Beer Alcohol vs. An Phat Plastic
Performance |
| Timeline |
| Hanoi Beer Alcohol |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| An Phat Plastic |
Hanoi Beer and An Phat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanoi Beer and An Phat
The main advantage of trading using opposite Hanoi Beer and An Phat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanoi Beer position performs unexpectedly, An Phat 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 An Phat will offset losses from the drop in An Phat's long position.| Hanoi Beer vs. Dong A Hotel | Hanoi Beer vs. Nafoods Group JSC | Hanoi Beer vs. FPT Digital Retail | Hanoi Beer vs. Saigon Beer Alcohol |
| An Phat vs. Saigon Beer Alcohol | An Phat vs. Vietnam Rubber Group | An Phat vs. Hanoi Plastics JSC | An Phat vs. Binh Minh Plastics |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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