Correlation Between Ben Thanh and Idico JSC
Can any of the company-specific risk be diversified away by investing in both Ben Thanh and Idico JSC 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 Idico JSC 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 Idico JSC, you can compare the effects of market volatilities on Ben Thanh and Idico JSC 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 Idico JSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ben Thanh and Idico JSC.
Diversification Opportunities for Ben Thanh and Idico JSC
Excellent diversification
The 3 months correlation between Ben and Idico is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ben Thanh Rubber and Idico JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Idico JSC 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 Idico JSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Idico JSC has no effect on the direction of Ben Thanh i.e., Ben Thanh and Idico JSC go up and down completely randomly.
Pair Corralation between Ben Thanh and Idico JSC
Assuming the 90 days trading horizon Ben Thanh Rubber is expected to generate 0.5 times more return on investment than Idico JSC. However, Ben Thanh Rubber is 2.01 times less risky than Idico JSC. It trades about 0.2 of its potential returns per unit of risk. Idico JSC is currently generating about -0.06 per unit of risk. If you would invest 1,365,000 in Ben Thanh Rubber on September 13, 2024 and sell it today you would earn a total of 40,000 from holding Ben Thanh Rubber or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ben Thanh Rubber vs. Idico JSC
Performance |
| Timeline |
| Ben Thanh Rubber |
| Idico JSC |
Ben Thanh and Idico JSC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ben Thanh and Idico JSC
The main advantage of trading using opposite Ben Thanh and Idico JSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ben Thanh position performs unexpectedly, Idico JSC 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 Idico JSC will offset losses from the drop in Idico JSC's long position.| Ben Thanh vs. FIT INVEST JSC | Ben Thanh vs. Damsan JSC | Ben Thanh vs. An Phat Plastic | Ben Thanh vs. Alphanam ME |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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