Correlation Between Kien Giang and Riverway Management
Can any of the company-specific risk be diversified away by investing in both Kien Giang and Riverway Management 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 Kien Giang and Riverway Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kien Giang Construction and Riverway Management JSC, you can compare the effects of market volatilities on Kien Giang and Riverway Management 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 Kien Giang with a short position of Riverway Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kien Giang and Riverway Management.
Diversification Opportunities for Kien Giang and Riverway Management
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kien and Riverway is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Kien Giang Construction and Riverway Management JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Riverway Management JSC and Kien Giang 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 Kien Giang Construction are associated (or correlated) with Riverway Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Riverway Management JSC has no effect on the direction of Kien Giang i.e., Kien Giang and Riverway Management go up and down completely randomly.
Pair Corralation between Kien Giang and Riverway Management
Assuming the 90 days trading horizon Kien Giang Construction is expected to generate 0.81 times more return on investment than Riverway Management. However, Kien Giang Construction is 1.23 times less risky than Riverway Management. It trades about -0.16 of its potential returns per unit of risk. Riverway Management JSC is currently generating about -0.16 per unit of risk. If you would invest 2,520,000 in Kien Giang Construction on August 30, 2024 and sell it today you would lose (215,000) from holding Kien Giang Construction or give up 8.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Kien Giang Construction vs. Riverway Management JSC
Performance |
| Timeline |
| Kien Giang Construction |
| Riverway Management JSC |
Kien Giang and Riverway Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kien Giang and Riverway Management
The main advantage of trading using opposite Kien Giang and Riverway Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kien Giang position performs unexpectedly, Riverway Management 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 Riverway Management will offset losses from the drop in Riverway Management's long position.| Kien Giang vs. FIT INVEST JSC | Kien Giang vs. Damsan JSC | Kien Giang vs. An Phat Plastic | Kien Giang vs. Alphanam ME |
| Riverway Management vs. FIT INVEST JSC | Riverway Management vs. Damsan JSC | Riverway Management vs. An Phat Plastic | Riverway Management 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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