Correlation Between Viettel Construction and Binh Duong
Can any of the company-specific risk be diversified away by investing in both Viettel Construction and Binh Duong 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 Viettel Construction and Binh Duong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viettel Construction JSC and Binh Duong Construction, you can compare the effects of market volatilities on Viettel Construction and Binh Duong 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 Viettel Construction with a short position of Binh Duong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viettel Construction and Binh Duong.
Diversification Opportunities for Viettel Construction and Binh Duong
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Viettel and Binh is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Viettel Construction JSC and Binh Duong Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Duong Construction and Viettel Construction 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 Viettel Construction JSC are associated (or correlated) with Binh Duong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binh Duong Construction has no effect on the direction of Viettel Construction i.e., Viettel Construction and Binh Duong go up and down completely randomly.
Pair Corralation between Viettel Construction and Binh Duong
Assuming the 90 days trading horizon Viettel Construction JSC is expected to generate 1.5 times more return on investment than Binh Duong. However, Viettel Construction is 1.5 times more volatile than Binh Duong Construction. It trades about 0.08 of its potential returns per unit of risk. Binh Duong Construction is currently generating about 0.01 per unit of risk. If you would invest 7,102,284 in Viettel Construction JSC on September 12, 2024 and sell it today you would earn a total of 5,297,716 from holding Viettel Construction JSC or generate 74.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Viettel Construction JSC vs. Binh Duong Construction
Performance |
| Timeline |
| Viettel Construction JSC |
| Binh Duong Construction |
Viettel Construction and Binh Duong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viettel Construction and Binh Duong
The main advantage of trading using opposite Viettel Construction and Binh Duong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viettel Construction position performs unexpectedly, Binh Duong 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 Binh Duong will offset losses from the drop in Binh Duong's long position.| Viettel Construction vs. FIT INVEST JSC | Viettel Construction vs. Damsan JSC | Viettel Construction vs. An Phat Plastic | Viettel Construction vs. Alphanam ME |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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