Correlation Between Elcom Technology and Thanh Thai
Can any of the company-specific risk be diversified away by investing in both Elcom Technology and Thanh Thai 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 Elcom Technology and Thanh Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elcom Technology Communications and Thanh Thai Group, you can compare the effects of market volatilities on Elcom Technology and Thanh Thai 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 Elcom Technology with a short position of Thanh Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elcom Technology and Thanh Thai.
Diversification Opportunities for Elcom Technology and Thanh Thai
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Elcom and Thanh is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Elcom Technology Communication and Thanh Thai Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanh Thai Group and Elcom Technology 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 Elcom Technology Communications are associated (or correlated) with Thanh Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanh Thai Group has no effect on the direction of Elcom Technology i.e., Elcom Technology and Thanh Thai go up and down completely randomly.
Pair Corralation between Elcom Technology and Thanh Thai
Assuming the 90 days trading horizon Elcom Technology Communications is expected to under-perform the Thanh Thai. But the stock apears to be less risky and, when comparing its historical volatility, Elcom Technology Communications is 1.24 times less risky than Thanh Thai. The stock trades about -0.04 of its potential returns per unit of risk. The Thanh Thai Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 640,000 in Thanh Thai Group on November 28, 2024 and sell it today you would earn a total of 10,000 from holding Thanh Thai Group or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 58.82% |
| Values | Daily Returns |
Elcom Technology Communication vs. Thanh Thai Group
Performance |
| Timeline |
| Elcom Technology Com |
| Thanh Thai Group |
Elcom Technology and Thanh Thai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elcom Technology and Thanh Thai
The main advantage of trading using opposite Elcom Technology and Thanh Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elcom Technology position performs unexpectedly, Thanh Thai 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 Thanh Thai will offset losses from the drop in Thanh Thai's long position.| Elcom Technology vs. BIDV Insurance Corp | Elcom Technology vs. Saigon Beer Alcohol | Elcom Technology vs. Hanoi Beer Alcohol | Elcom Technology vs. Telecoms Informatics JSC |
| Thanh Thai vs. Dinhvu Port Investment | Thanh Thai vs. LDG Investment JSC | Thanh Thai vs. Ipa Investments Group | Thanh Thai vs. HUD1 Investment and |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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