Correlation Between Southern Rubber and Thong Nhat
Can any of the company-specific risk be diversified away by investing in both Southern Rubber and Thong Nhat 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 Southern Rubber and Thong Nhat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Rubber Industry and Thong Nhat Rubber, you can compare the effects of market volatilities on Southern Rubber and Thong Nhat 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 Southern Rubber with a short position of Thong Nhat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Rubber and Thong Nhat.
Diversification Opportunities for Southern Rubber and Thong Nhat
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Southern and Thong is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Southern Rubber Industry and Thong Nhat Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thong Nhat Rubber and Southern Rubber 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 Southern Rubber Industry are associated (or correlated) with Thong Nhat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thong Nhat Rubber has no effect on the direction of Southern Rubber i.e., Southern Rubber and Thong Nhat go up and down completely randomly.
Pair Corralation between Southern Rubber and Thong Nhat
Assuming the 90 days trading horizon Southern Rubber Industry is expected to generate 0.5 times more return on investment than Thong Nhat. However, Southern Rubber Industry is 2.01 times less risky than Thong Nhat. It trades about 0.06 of its potential returns per unit of risk. Thong Nhat Rubber is currently generating about -0.04 per unit of risk. If you would invest 1,275,000 in Southern Rubber Industry on September 2, 2024 and sell it today you would earn a total of 90,000 from holding Southern Rubber Industry or generate 7.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.5% |
| Values | Daily Returns |
Southern Rubber Industry vs. Thong Nhat Rubber
Performance |
| Timeline |
| Southern Rubber Industry |
| Thong Nhat Rubber |
Southern Rubber and Thong Nhat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Rubber and Thong Nhat
The main advantage of trading using opposite Southern Rubber and Thong Nhat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Rubber position performs unexpectedly, Thong Nhat 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 Thong Nhat will offset losses from the drop in Thong Nhat's long position.| Southern Rubber vs. FIT INVEST JSC | Southern Rubber vs. Damsan JSC | Southern Rubber vs. An Phat Plastic | Southern Rubber vs. Alphanam ME |
| Thong Nhat vs. BaoMinh Insurance Corp | Thong Nhat vs. Song Hong Aluminum | Thong Nhat vs. Hanoi Beer Alcohol | Thong Nhat vs. Southern Rubber Industry |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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