Correlation Between COMA 18 and Truong Thanh
Can any of the company-specific risk be diversified away by investing in both COMA 18 and Truong Thanh 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 COMA 18 and Truong Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMA 18 JSC and Truong Thanh Furniture, you can compare the effects of market volatilities on COMA 18 and Truong Thanh 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 COMA 18 with a short position of Truong Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMA 18 and Truong Thanh.
Diversification Opportunities for COMA 18 and Truong Thanh
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between COMA and Truong is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding COMA 18 JSC and Truong Thanh Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Truong Thanh Furniture and COMA 18 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 COMA 18 JSC are associated (or correlated) with Truong Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Truong Thanh Furniture has no effect on the direction of COMA 18 i.e., COMA 18 and Truong Thanh go up and down completely randomly.
Pair Corralation between COMA 18 and Truong Thanh
Assuming the 90 days trading horizon COMA 18 JSC is expected to generate 1.36 times more return on investment than Truong Thanh. However, COMA 18 is 1.36 times more volatile than Truong Thanh Furniture. It trades about 0.07 of its potential returns per unit of risk. Truong Thanh Furniture is currently generating about -0.03 per unit of risk. If you would invest 385,000 in COMA 18 JSC on September 2, 2024 and sell it today you would earn a total of 522,000 from holding COMA 18 JSC or generate 135.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMA 18 JSC vs. Truong Thanh Furniture
Performance |
| Timeline |
| COMA 18 JSC |
| Truong Thanh Furniture |
COMA 18 and Truong Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMA 18 and Truong Thanh
The main advantage of trading using opposite COMA 18 and Truong Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMA 18 position performs unexpectedly, Truong Thanh 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 Truong Thanh will offset losses from the drop in Truong Thanh's long position.| COMA 18 vs. Global Electrical Technology | COMA 18 vs. Saigon Telecommunication Technologies | COMA 18 vs. Saigon Beer Alcohol | COMA 18 vs. Nafoods Group JSC |
| Truong Thanh vs. FIT INVEST JSC | Truong Thanh vs. Damsan JSC | Truong Thanh vs. An Phat Plastic | Truong Thanh vs. Alphanam ME |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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