Correlation Between Viettel Construction and Vietnam Dairy
Can any of the company-specific risk be diversified away by investing in both Viettel Construction and Vietnam Dairy 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 Vietnam Dairy 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 Vietnam Dairy Products, you can compare the effects of market volatilities on Viettel Construction and Vietnam Dairy 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 Vietnam Dairy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viettel Construction and Vietnam Dairy.
Diversification Opportunities for Viettel Construction and Vietnam Dairy
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Viettel and Vietnam is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Viettel Construction JSC and Vietnam Dairy Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam Dairy Products 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 Vietnam Dairy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam Dairy Products has no effect on the direction of Viettel Construction i.e., Viettel Construction and Vietnam Dairy go up and down completely randomly.
Pair Corralation between Viettel Construction and Vietnam Dairy
Assuming the 90 days trading horizon Viettel Construction JSC is expected to generate 1.93 times more return on investment than Vietnam Dairy. However, Viettel Construction is 1.93 times more volatile than Vietnam Dairy Products. It trades about 0.09 of its potential returns per unit of risk. Vietnam Dairy Products is currently generating about -0.03 per unit of risk. If you would invest 4,754,712 in Viettel Construction JSC on August 27, 2024 and sell it today you would earn a total of 7,135,288 from holding Viettel Construction JSC or generate 150.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Viettel Construction JSC vs. Vietnam Dairy Products
Performance |
| Timeline |
| Viettel Construction JSC |
| Vietnam Dairy Products |
Viettel Construction and Vietnam Dairy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viettel Construction and Vietnam Dairy
The main advantage of trading using opposite Viettel Construction and Vietnam Dairy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viettel Construction position performs unexpectedly, Vietnam Dairy 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 Dairy will offset losses from the drop in Vietnam Dairy's long position.| Viettel Construction vs. FIT INVEST JSC | Viettel Construction vs. Damsan JSC | Viettel Construction vs. An Phat Plastic | Viettel Construction vs. APG Securities Joint |
| Vietnam Dairy vs. Industrial Urban Development | Vietnam Dairy vs. TDT Investment and | Vietnam Dairy vs. Saigon Beer Alcohol | Vietnam Dairy vs. Vu Dang Investment |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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