Correlation Between Binh Minh and An Phat
Can any of the company-specific risk be diversified away by investing in both Binh Minh 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 Binh Minh and An Phat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binh Minh Plastics and An Phat Plastic, you can compare the effects of market volatilities on Binh Minh 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 Binh Minh with a short position of An Phat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Minh and An Phat.
Diversification Opportunities for Binh Minh and An Phat
Very weak diversification
The 3 months correlation between Binh and AAA is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Binh Minh Plastics 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 Binh Minh 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 Minh Plastics 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 Binh Minh i.e., Binh Minh and An Phat go up and down completely randomly.
Pair Corralation between Binh Minh and An Phat
Assuming the 90 days trading horizon Binh Minh Plastics is expected to under-perform the An Phat. In addition to that, Binh Minh is 2.2 times more volatile than An Phat Plastic. It trades about -0.15 of its total potential returns per unit of risk. An Phat Plastic is currently generating about -0.31 per unit of volatility. If you would invest 874,000 in An Phat Plastic on November 2, 2024 and sell it today you would lose (38,000) from holding An Phat Plastic or give up 4.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binh Minh Plastics vs. An Phat Plastic
Performance |
| Timeline |
| Binh Minh Plastics |
| An Phat Plastic |
Binh Minh and An Phat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Minh and An Phat
The main advantage of trading using opposite Binh Minh and An Phat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Minh 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.| Binh Minh vs. Saigon Beer Alcohol | Binh Minh vs. Cotec Construction JSC | Binh Minh vs. Petrovietnam Drilling Mud | Binh Minh vs. Hung Hau Agricultural |
| An Phat vs. Pha Le Plastics | An Phat vs. DOMESCO Medical Import | An Phat vs. Nafoods Group JSC | An Phat vs. Vietnam Rubber Group |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |