Correlation Between Elcom Technology and Truong Thanh
Can any of the company-specific risk be diversified away by investing in both Elcom Technology and Truong Thanh 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 Truong Thanh 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 Truong Thanh Furniture, you can compare the effects of market volatilities on Elcom Technology and Truong Thanh 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 Truong Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elcom Technology and Truong Thanh.
Diversification Opportunities for Elcom Technology and Truong Thanh
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Elcom and Truong is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Elcom Technology Communication and Truong Thanh Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Truong Thanh Furniture 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 Truong Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Truong Thanh Furniture has no effect on the direction of Elcom Technology i.e., Elcom Technology and Truong Thanh go up and down completely randomly.
Pair Corralation between Elcom Technology and Truong Thanh
Assuming the 90 days trading horizon Elcom Technology Communications is expected to generate 1.99 times more return on investment than Truong Thanh. However, Elcom Technology is 1.99 times more volatile than Truong Thanh Furniture. It trades about 0.2 of its potential returns per unit of risk. Truong Thanh Furniture is currently generating about -0.32 per unit of risk. If you would invest 2,620,000 in Elcom Technology Communications on November 7, 2024 and sell it today you would earn a total of 175,000 from holding Elcom Technology Communications or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 88.89% |
| Values | Daily Returns |
Elcom Technology Communication vs. Truong Thanh Furniture
Performance |
| Timeline |
| Elcom Technology Com |
| Truong Thanh Furniture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Elcom Technology and Truong Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elcom Technology and Truong Thanh
The main advantage of trading using opposite Elcom Technology and Truong Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elcom Technology position performs unexpectedly, Truong Thanh 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 Truong Thanh will offset losses from the drop in Truong Thanh's long position.| Elcom Technology vs. HUD1 Investment and | Elcom Technology vs. Binhthuan Agriculture Services | Elcom Technology vs. Transport and Industry |
| Truong Thanh vs. Elcom Technology Communications | Truong Thanh vs. Transport and Industry | Truong Thanh vs. Hai An Transport | Truong Thanh 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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