Correlation Between South Basic and Vietnam JSCmmercial
Can any of the company-specific risk be diversified away by investing in both South Basic and Vietnam JSCmmercial 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 South Basic and Vietnam JSCmmercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between South Basic Chemicals and Vietnam JSCmmercial Bank, you can compare the effects of market volatilities on South Basic and Vietnam JSCmmercial 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 South Basic with a short position of Vietnam JSCmmercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of South Basic and Vietnam JSCmmercial.
Diversification Opportunities for South Basic and Vietnam JSCmmercial
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between South and Vietnam is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding South Basic Chemicals and Vietnam JSCmmercial Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam JSCmmercial Bank and South Basic 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 South Basic Chemicals are associated (or correlated) with Vietnam JSCmmercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam JSCmmercial Bank has no effect on the direction of South Basic i.e., South Basic and Vietnam JSCmmercial go up and down completely randomly.
Pair Corralation between South Basic and Vietnam JSCmmercial
Assuming the 90 days trading horizon South Basic Chemicals is expected to under-perform the Vietnam JSCmmercial. In addition to that, South Basic is 6.7 times more volatile than Vietnam JSCmmercial Bank. It trades about -0.09 of its total potential returns per unit of risk. Vietnam JSCmmercial Bank is currently generating about 0.06 per unit of volatility. If you would invest 3,240,000 in Vietnam JSCmmercial Bank on September 3, 2024 and sell it today you would earn a total of 345,000 from holding Vietnam JSCmmercial Bank or generate 10.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
South Basic Chemicals vs. Vietnam JSCmmercial Bank
Performance |
| Timeline |
| South Basic Chemicals |
| Vietnam JSCmmercial Bank |
South Basic and Vietnam JSCmmercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with South Basic and Vietnam JSCmmercial
The main advantage of trading using opposite South Basic and Vietnam JSCmmercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South Basic position performs unexpectedly, Vietnam JSCmmercial 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 JSCmmercial will offset losses from the drop in Vietnam JSCmmercial's long position.| South Basic vs. Vincom Retail JSC | South Basic vs. Vietnam Dairy Products | South Basic vs. Post and Telecommunications | South Basic vs. POST TELECOMMU |
| Vietnam JSCmmercial vs. FIT INVEST JSC | Vietnam JSCmmercial vs. Damsan JSC | Vietnam JSCmmercial vs. An Phat Plastic | Vietnam JSCmmercial 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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