Correlation Between Ba Ria and Van Phat
Can any of the company-specific risk be diversified away by investing in both Ba Ria and Van 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 Ba Ria and Van Phat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ba Ria Thermal and Van Phat Hung, you can compare the effects of market volatilities on Ba Ria and Van 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 Ba Ria with a short position of Van Phat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ba Ria and Van Phat.
Diversification Opportunities for Ba Ria and Van Phat
Very good diversification
The 3 months correlation between BTP and Van is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ba Ria Thermal and Van Phat Hung in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Van Phat Hung and Ba Ria 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 Ba Ria Thermal are associated (or correlated) with Van Phat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Van Phat Hung has no effect on the direction of Ba Ria i.e., Ba Ria and Van Phat go up and down completely randomly.
Pair Corralation between Ba Ria and Van Phat
Assuming the 90 days trading horizon Ba Ria is expected to generate 1.18 times less return on investment than Van Phat. But when comparing it to its historical volatility, Ba Ria Thermal is 2.51 times less risky than Van Phat. It trades about 0.2 of its potential returns per unit of risk. Van Phat Hung is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 659,000 in Van Phat Hung on November 28, 2024 and sell it today you would earn a total of 21,000 from holding Van Phat Hung or generate 3.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ba Ria Thermal vs. Van Phat Hung
Performance |
| Timeline |
| Ba Ria Thermal |
| Van Phat Hung |
Ba Ria and Van Phat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ba Ria and Van Phat
The main advantage of trading using opposite Ba Ria and Van Phat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ba Ria position performs unexpectedly, Van 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 Van Phat will offset losses from the drop in Van Phat's long position.| Ba Ria vs. Vietnam Construction JSC | Ba Ria vs. Techno Agricultural Supplying | Ba Ria vs. DIC Holdings Construction | Ba Ria vs. Saigon Machinery Spare |
| Van Phat vs. Innovative Technology Development | Van Phat vs. Post and Telecommunications | Van Phat vs. Song Hong Aluminum | Van Phat vs. Tienlen Steel Corp |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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