Correlation Between Ha Noi and Hung Hau
Can any of the company-specific risk be diversified away by investing in both Ha Noi and Hung Hau 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 Hung Hau 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 Hung Hau Agricultural, you can compare the effects of market volatilities on Ha Noi and Hung Hau 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 Hung Hau. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ha Noi and Hung Hau.
Diversification Opportunities for Ha Noi and Hung Hau
Good diversification
The 3 months correlation between EID and Hung is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ha Noi Education and Hung Hau Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hung Hau Agricultural 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 Hung Hau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hung Hau Agricultural has no effect on the direction of Ha Noi i.e., Ha Noi and Hung Hau go up and down completely randomly.
Pair Corralation between Ha Noi and Hung Hau
Assuming the 90 days trading horizon Ha Noi Education is expected to under-perform the Hung Hau. But the stock apears to be less risky and, when comparing its historical volatility, Ha Noi Education is 4.74 times less risky than Hung Hau. The stock trades about -0.19 of its potential returns per unit of risk. The Hung Hau Agricultural is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 980,000 in Hung Hau Agricultural on August 30, 2024 and sell it today you would earn a total of 120,000 from holding Hung Hau Agricultural or generate 12.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 57.14% |
| Values | Daily Returns |
Ha Noi Education vs. Hung Hau Agricultural
Performance |
| Timeline |
| Ha Noi Education |
| Hung Hau Agricultural |
Ha Noi and Hung Hau Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ha Noi and Hung Hau
The main advantage of trading using opposite Ha Noi and Hung Hau positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ha Noi position performs unexpectedly, Hung Hau 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 Hung Hau will offset losses from the drop in Hung Hau's long position.The idea behind Ha Noi Education and Hung Hau Agricultural 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.| Hung Hau vs. PetroVietnam Transportation Corp | Hung Hau vs. Travel Investment and | Hung Hau vs. Nam Long Investment | Hung Hau vs. Ba Ria Thermal |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |