Correlation Between Thanh Dat and Construction
Can any of the company-specific risk be diversified away by investing in both Thanh Dat and Construction 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 Construction 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 Construction And Investment, you can compare the effects of market volatilities on Thanh Dat and Construction 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 Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and Construction.
Diversification Opportunities for Thanh Dat and Construction
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thanh and Construction is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and Construction And Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Construction And Inv 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 Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Construction And Inv has no effect on the direction of Thanh Dat i.e., Thanh Dat and Construction go up and down completely randomly.
Pair Corralation between Thanh Dat and Construction
Assuming the 90 days trading horizon Thanh Dat is expected to generate 1.56 times less return on investment than Construction. In addition to that, Thanh Dat is 1.39 times more volatile than Construction And Investment. It trades about 0.08 of its total potential returns per unit of risk. Construction And Investment is currently generating about 0.17 per unit of volatility. If you would invest 3,660,000 in Construction And Investment on August 30, 2024 and sell it today you would earn a total of 260,000 from holding Construction And Investment or generate 7.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thanh Dat Investment vs. Construction And Investment
Performance |
| Timeline |
| Thanh Dat Investment |
| Construction And Inv |
Thanh Dat and Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thanh Dat and Construction
The main advantage of trading using opposite Thanh Dat and Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thanh Dat position performs unexpectedly, Construction 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 Construction will offset losses from the drop in Construction'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 |
| Construction vs. Song Hong Construction | Construction vs. 577 Investment Corp | Construction vs. Danang Education Investment | Construction 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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