Correlation Between Ha Noi and Viettel Construction
Can any of the company-specific risk be diversified away by investing in both Ha Noi and Viettel 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 Ha Noi and Viettel Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ha Noi Education and Viettel Construction JSC, you can compare the effects of market volatilities on Ha Noi and Viettel 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 Ha Noi with a short position of Viettel Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ha Noi and Viettel Construction.
Diversification Opportunities for Ha Noi and Viettel Construction
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between EID and Viettel is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ha Noi Education and Viettel Construction JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viettel Construction JSC and Ha Noi 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 Ha Noi Education are associated (or correlated) with Viettel Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viettel Construction JSC has no effect on the direction of Ha Noi i.e., Ha Noi and Viettel Construction go up and down completely randomly.
Pair Corralation between Ha Noi and Viettel Construction
Assuming the 90 days trading horizon Ha Noi Education is expected to generate 0.22 times more return on investment than Viettel Construction. However, Ha Noi Education is 4.6 times less risky than Viettel Construction. It trades about -0.19 of its potential returns per unit of risk. Viettel Construction JSC is currently generating about -0.18 per unit of risk. If you would invest 2,760,000 in Ha Noi Education on August 30, 2024 and sell it today you would lose (60,000) from holding Ha Noi Education or give up 2.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ha Noi Education vs. Viettel Construction JSC
Performance |
| Timeline |
| Ha Noi Education |
| Viettel Construction JSC |
Ha Noi and Viettel Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ha Noi and Viettel Construction
The main advantage of trading using opposite Ha Noi and Viettel Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ha Noi position performs unexpectedly, Viettel 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 Viettel Construction will offset losses from the drop in Viettel Construction's long position.The idea behind Ha Noi Education and Viettel Construction JSC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Viettel Construction vs. Sea Air Freight | Viettel Construction vs. DOMESCO Medical Import | Viettel Construction vs. Military Insurance Corp | Viettel Construction vs. Japan Vietnam Medical |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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