Correlation Between Binh Minh and Danang Education
Can any of the company-specific risk be diversified away by investing in both Binh Minh and Danang Education 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 Danang Education 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 Danang Education Investment, you can compare the effects of market volatilities on Binh Minh and Danang Education 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 Danang Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Minh and Danang Education.
Diversification Opportunities for Binh Minh and Danang Education
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Binh and Danang is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Binh Minh Plastics and Danang Education Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danang Education Inv 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 Danang Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danang Education Inv has no effect on the direction of Binh Minh i.e., Binh Minh and Danang Education go up and down completely randomly.
Pair Corralation between Binh Minh and Danang Education
Assuming the 90 days trading horizon Binh Minh Plastics is expected to generate 0.65 times more return on investment than Danang Education. However, Binh Minh Plastics is 1.55 times less risky than Danang Education. It trades about 0.09 of its potential returns per unit of risk. Danang Education Investment is currently generating about 0.02 per unit of risk. If you would invest 6,512,898 in Binh Minh Plastics on October 12, 2024 and sell it today you would earn a total of 6,987,102 from holding Binh Minh Plastics or generate 107.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 68.27% |
| Values | Daily Returns |
Binh Minh Plastics vs. Danang Education Investment
Performance |
| Timeline |
| Binh Minh Plastics |
| Danang Education Inv |
Binh Minh and Danang Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Minh and Danang Education
The main advantage of trading using opposite Binh Minh and Danang Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Minh position performs unexpectedly, Danang Education 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 Danang Education will offset losses from the drop in Danang Education's long position.| Binh Minh vs. BIDV Insurance Corp | Binh Minh vs. BaoMinh Insurance Corp | Binh Minh vs. CEO Group JSC | Binh Minh vs. Saigon Viendong Technology |
| Danang Education vs. FIT INVEST JSC | Danang Education vs. Damsan JSC | Danang Education vs. An Phat Plastic | Danang Education vs. APG Securities Joint |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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