Correlation Between Ben Thanh and Ducgiang Chemicals
Can any of the company-specific risk be diversified away by investing in both Ben Thanh and Ducgiang Chemicals 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 Ben Thanh and Ducgiang Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ben Thanh Rubber and Ducgiang Chemicals Detergent, you can compare the effects of market volatilities on Ben Thanh and Ducgiang Chemicals 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 Ben Thanh with a short position of Ducgiang Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ben Thanh and Ducgiang Chemicals.
Diversification Opportunities for Ben Thanh and Ducgiang Chemicals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ben and Ducgiang is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ben Thanh Rubber and Ducgiang Chemicals Detergent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ducgiang Chemicals and Ben Thanh 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 Ben Thanh Rubber are associated (or correlated) with Ducgiang Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ducgiang Chemicals has no effect on the direction of Ben Thanh i.e., Ben Thanh and Ducgiang Chemicals go up and down completely randomly.
Pair Corralation between Ben Thanh and Ducgiang Chemicals
Assuming the 90 days trading horizon Ben Thanh is expected to generate 1.26 times less return on investment than Ducgiang Chemicals. But when comparing it to its historical volatility, Ben Thanh Rubber is 1.01 times less risky than Ducgiang Chemicals. It trades about 0.07 of its potential returns per unit of risk. Ducgiang Chemicals Detergent is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 4,819,236 in Ducgiang Chemicals Detergent on October 30, 2024 and sell it today you would earn a total of 6,320,764 from holding Ducgiang Chemicals Detergent or generate 131.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.96% |
| Values | Daily Returns |
Ben Thanh Rubber vs. Ducgiang Chemicals Detergent
Performance |
| Timeline |
| Ben Thanh Rubber |
| Ducgiang Chemicals |
Ben Thanh and Ducgiang Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ben Thanh and Ducgiang Chemicals
The main advantage of trading using opposite Ben Thanh and Ducgiang Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ben Thanh position performs unexpectedly, Ducgiang Chemicals 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 Ducgiang Chemicals will offset losses from the drop in Ducgiang Chemicals' long position.| Ben Thanh vs. Nafoods Group JSC | Ben Thanh vs. South Basic Chemicals | Ben Thanh vs. Techno Agricultural Supplying | Ben Thanh vs. Pacific Petroleum Transportation |
| Ducgiang Chemicals vs. VTC Telecommunications JSC | Ducgiang Chemicals vs. Petrolimex Insurance Corp | Ducgiang Chemicals vs. Hai An Transport | Ducgiang Chemicals vs. Hanoi Beer Alcohol |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |