Correlation Between CEO Group and Vietnam Airlines
Can any of the company-specific risk be diversified away by investing in both CEO Group and Vietnam Airlines 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 CEO Group and Vietnam Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEO Group JSC and Vietnam Airlines JSC, you can compare the effects of market volatilities on CEO Group and Vietnam Airlines 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 CEO Group with a short position of Vietnam Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEO Group and Vietnam Airlines.
Diversification Opportunities for CEO Group and Vietnam Airlines
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CEO and Vietnam is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding CEO Group JSC and Vietnam Airlines JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam Airlines JSC and CEO Group 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 CEO Group JSC are associated (or correlated) with Vietnam Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam Airlines JSC has no effect on the direction of CEO Group i.e., CEO Group and Vietnam Airlines go up and down completely randomly.
Pair Corralation between CEO Group and Vietnam Airlines
Assuming the 90 days trading horizon CEO Group JSC is expected to under-perform the Vietnam Airlines. But the stock apears to be less risky and, when comparing its historical volatility, CEO Group JSC is 1.9 times less risky than Vietnam Airlines. The stock trades about -0.18 of its potential returns per unit of risk. The Vietnam Airlines JSC is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 2,235,000 in Vietnam Airlines JSC on August 31, 2024 and sell it today you would earn a total of 505,000 from holding Vietnam Airlines JSC or generate 22.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CEO Group JSC vs. Vietnam Airlines JSC
Performance |
| Timeline |
| CEO Group JSC |
| Vietnam Airlines JSC |
CEO Group and Vietnam Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEO Group and Vietnam Airlines
The main advantage of trading using opposite CEO Group and Vietnam Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEO Group position performs unexpectedly, Vietnam Airlines 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 Vietnam Airlines will offset losses from the drop in Vietnam Airlines' long position.| CEO Group vs. FIT INVEST JSC | CEO Group vs. Damsan JSC | CEO Group vs. An Phat Plastic | CEO Group vs. Alphanam ME |
| Vietnam Airlines vs. Song Hong Garment | Vietnam Airlines vs. Alphanam ME | Vietnam Airlines vs. Hochiminh City Metal | Vietnam Airlines vs. Atesco Industrial Cartering |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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