Correlation Between Bao Ngoc and Ba Ria
Can any of the company-specific risk be diversified away by investing in both Bao Ngoc and Ba Ria 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 Bao Ngoc and Ba Ria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bao Ngoc Investment and Ba Ria Thermal, you can compare the effects of market volatilities on Bao Ngoc and Ba Ria 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 Bao Ngoc with a short position of Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bao Ngoc and Ba Ria.
Diversification Opportunities for Bao Ngoc and Ba Ria
Modest diversification
The 3 months correlation between Bao and BTP is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Bao Ngoc Investment and Ba Ria Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ba Ria Thermal and Bao Ngoc 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 Bao Ngoc Investment are associated (or correlated) with Ba Ria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ba Ria Thermal has no effect on the direction of Bao Ngoc i.e., Bao Ngoc and Ba Ria go up and down completely randomly.
Pair Corralation between Bao Ngoc and Ba Ria
Assuming the 90 days trading horizon Bao Ngoc Investment is expected to generate 1.56 times more return on investment than Ba Ria. However, Bao Ngoc is 1.56 times more volatile than Ba Ria Thermal. It trades about 0.01 of its potential returns per unit of risk. Ba Ria Thermal is currently generating about 0.02 per unit of risk. If you would invest 952,000 in Bao Ngoc Investment on August 28, 2024 and sell it today you would lose (12,000) from holding Bao Ngoc Investment or give up 1.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
Bao Ngoc Investment vs. Ba Ria Thermal
Performance |
| Timeline |
| Bao Ngoc Investment |
| Ba Ria Thermal |
Bao Ngoc and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bao Ngoc and Ba Ria
The main advantage of trading using opposite Bao Ngoc and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bao Ngoc position performs unexpectedly, Ba Ria 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 Ba Ria will offset losses from the drop in Ba Ria's long position.| Bao Ngoc vs. FIT INVEST JSC | Bao Ngoc vs. Damsan JSC | Bao Ngoc vs. An Phat Plastic | Bao Ngoc vs. APG Securities Joint |
| Ba Ria vs. FIT INVEST JSC | Ba Ria vs. Damsan JSC | Ba Ria vs. An Phat Plastic | Ba Ria 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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