Correlation Between Thanh Dat and Hai An
Can any of the company-specific risk be diversified away by investing in both Thanh Dat and Hai An 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 Thanh Dat and Hai An into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thanh Dat Investment and Hai An Transport, you can compare the effects of market volatilities on Thanh Dat and Hai An 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 Thanh Dat with a short position of Hai An. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and Hai An.
Diversification Opportunities for Thanh Dat and Hai An
Very poor diversification
The 3 months correlation between Thanh and Hai is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and Hai An Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hai An Transport and Thanh Dat 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 Thanh Dat Investment are associated (or correlated) with Hai An. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hai An Transport has no effect on the direction of Thanh Dat i.e., Thanh Dat and Hai An go up and down completely randomly.
Pair Corralation between Thanh Dat and Hai An
Assuming the 90 days trading horizon Thanh Dat is expected to generate 99.51 times less return on investment than Hai An. But when comparing it to its historical volatility, Thanh Dat Investment is 1.08 times less risky than Hai An. It trades about 0.0 of its potential returns per unit of risk. Hai An Transport is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 4,685,000 in Hai An Transport on September 12, 2024 and sell it today you would earn a total of 385,000 from holding Hai An Transport or generate 8.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Thanh Dat Investment vs. Hai An Transport
Performance |
| Timeline |
| Thanh Dat Investment |
| Hai An Transport |
Thanh Dat and Hai An Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thanh Dat and Hai An
The main advantage of trading using opposite Thanh Dat and Hai An positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thanh Dat position performs unexpectedly, Hai An 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 Hai An will offset losses from the drop in Hai An's long position.| Thanh Dat vs. FIT INVEST JSC | Thanh Dat vs. Damsan JSC | Thanh Dat vs. An Phat Plastic | Thanh Dat 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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