Correlation Between BIDV Insurance and Tin Nghia
Can any of the company-specific risk be diversified away by investing in both BIDV Insurance and Tin Nghia 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 BIDV Insurance and Tin Nghia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BIDV Insurance Corp and Tin Nghia Industrial, you can compare the effects of market volatilities on BIDV Insurance and Tin Nghia 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 BIDV Insurance with a short position of Tin Nghia. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIDV Insurance and Tin Nghia.
Diversification Opportunities for BIDV Insurance and Tin Nghia
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between BIDV and Tin is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding BIDV Insurance Corp and Tin Nghia Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tin Nghia Industrial and BIDV Insurance 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 BIDV Insurance Corp are associated (or correlated) with Tin Nghia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tin Nghia Industrial has no effect on the direction of BIDV Insurance i.e., BIDV Insurance and Tin Nghia go up and down completely randomly.
Pair Corralation between BIDV Insurance and Tin Nghia
Assuming the 90 days trading horizon BIDV Insurance Corp is expected to generate 0.96 times more return on investment than Tin Nghia. However, BIDV Insurance Corp is 1.04 times less risky than Tin Nghia. It trades about 0.16 of its potential returns per unit of risk. Tin Nghia Industrial is currently generating about -0.03 per unit of risk. If you would invest 3,140,000 in BIDV Insurance Corp on August 29, 2024 and sell it today you would earn a total of 180,000 from holding BIDV Insurance Corp or generate 5.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BIDV Insurance Corp vs. Tin Nghia Industrial
Performance |
| Timeline |
| BIDV Insurance Corp |
| Tin Nghia Industrial |
BIDV Insurance and Tin Nghia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BIDV Insurance and Tin Nghia
The main advantage of trading using opposite BIDV Insurance and Tin Nghia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIDV Insurance position performs unexpectedly, Tin Nghia 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 Tin Nghia will offset losses from the drop in Tin Nghia's long position.| BIDV Insurance vs. FIT INVEST JSC | BIDV Insurance vs. Damsan JSC | BIDV Insurance vs. An Phat Plastic | BIDV Insurance vs. APG Securities Joint |
| Tin Nghia vs. Ben Thanh Rubber | Tin Nghia vs. Military Insurance Corp | Tin Nghia vs. FPT Digital Retail | Tin Nghia vs. Vietnam Airlines JSC |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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