Correlation Between Development Investment and Ha Do
Can any of the company-specific risk be diversified away by investing in both Development Investment and Ha Do 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 Development Investment and Ha Do into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Development Investment Construction and Ha Do Group, you can compare the effects of market volatilities on Development Investment and Ha Do 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 Development Investment with a short position of Ha Do. Check out your portfolio center. Please also check ongoing floating volatility patterns of Development Investment and Ha Do.
Diversification Opportunities for Development Investment and Ha Do
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Development and HDG is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Development Investment Constru and Ha Do Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ha Do Group and Development Investment 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 Development Investment Construction are associated (or correlated) with Ha Do. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ha Do Group has no effect on the direction of Development Investment i.e., Development Investment and Ha Do go up and down completely randomly.
Pair Corralation between Development Investment and Ha Do
Assuming the 90 days trading horizon Development Investment Construction is expected to generate 0.89 times more return on investment than Ha Do. However, Development Investment Construction is 1.13 times less risky than Ha Do. It trades about -0.02 of its potential returns per unit of risk. Ha Do Group is currently generating about -0.02 per unit of risk. If you would invest 2,366,683 in Development Investment Construction on August 28, 2024 and sell it today you would lose (816,683) from holding Development Investment Construction or give up 34.51% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 94.3% |
Values | Daily Returns |
Development Investment Constru vs. Ha Do Group
Performance |
Timeline |
Development Investment |
Ha Do Group |
Development Investment and Ha Do Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Development Investment and Ha Do
The main advantage of trading using opposite Development Investment and Ha Do positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Development Investment position performs unexpectedly, Ha Do 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 Ha Do will offset losses from the drop in Ha Do's long position.Development Investment vs. FIT INVEST JSC | Development Investment vs. Damsan JSC | Development Investment vs. An Phat Plastic | Development Investment vs. APG Securities Joint |
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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