Correlation Between Thanh Dat and Pha Lai
Can any of the company-specific risk be diversified away by investing in both Thanh Dat and Pha Lai 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 Pha Lai 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 Pha Lai Thermal, you can compare the effects of market volatilities on Thanh Dat and Pha Lai 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 Pha Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and Pha Lai.
Diversification Opportunities for Thanh Dat and Pha Lai
Good diversification
The 3 months correlation between Thanh and Pha is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and Pha Lai Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Lai Thermal 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 Pha Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Lai Thermal has no effect on the direction of Thanh Dat i.e., Thanh Dat and Pha Lai go up and down completely randomly.
Pair Corralation between Thanh Dat and Pha Lai
Assuming the 90 days trading horizon Thanh Dat Investment is expected to generate 2.07 times more return on investment than Pha Lai. However, Thanh Dat is 2.07 times more volatile than Pha Lai Thermal. It trades about 0.07 of its potential returns per unit of risk. Pha Lai Thermal is currently generating about 0.02 per unit of risk. If you would invest 998,110 in Thanh Dat Investment on August 29, 2024 and sell it today you would earn a total of 1,561,890 from holding Thanh Dat Investment or generate 156.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thanh Dat Investment vs. Pha Lai Thermal
Performance |
| Timeline |
| Thanh Dat Investment |
| Pha Lai Thermal |
Thanh Dat and Pha Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thanh Dat and Pha Lai
The main advantage of trading using opposite Thanh Dat and Pha Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thanh Dat position performs unexpectedly, Pha Lai 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 Pha Lai will offset losses from the drop in Pha Lai's long position.| Thanh Dat vs. Ducgiang Chemicals Detergent | Thanh Dat vs. Dinhvu Port Investment | Thanh Dat vs. Construction And Investment | Thanh Dat vs. Danang Education Investment |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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