Correlation Between Edinburgh Worldwide and VinaCapital Vietnam
Can any of the company-specific risk be diversified away by investing in both Edinburgh Worldwide and VinaCapital Vietnam 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 Edinburgh Worldwide and VinaCapital Vietnam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edinburgh Worldwide Investment and VinaCapital Vietnam Opportunity, you can compare the effects of market volatilities on Edinburgh Worldwide and VinaCapital Vietnam 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 Edinburgh Worldwide with a short position of VinaCapital Vietnam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edinburgh Worldwide and VinaCapital Vietnam.
Diversification Opportunities for Edinburgh Worldwide and VinaCapital Vietnam
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Edinburgh and VinaCapital is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Edinburgh Worldwide Investment and VinaCapital Vietnam Opportunit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VinaCapital Vietnam and Edinburgh Worldwide 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 Edinburgh Worldwide Investment are associated (or correlated) with VinaCapital Vietnam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VinaCapital Vietnam has no effect on the direction of Edinburgh Worldwide i.e., Edinburgh Worldwide and VinaCapital Vietnam go up and down completely randomly.
Pair Corralation between Edinburgh Worldwide and VinaCapital Vietnam
Assuming the 90 days trading horizon Edinburgh Worldwide Investment is expected to generate 1.48 times more return on investment than VinaCapital Vietnam. However, Edinburgh Worldwide is 1.48 times more volatile than VinaCapital Vietnam Opportunity. It trades about 0.02 of its potential returns per unit of risk. VinaCapital Vietnam Opportunity is currently generating about 0.02 per unit of risk. If you would invest 17,920 in Edinburgh Worldwide Investment on November 2, 2024 and sell it today you would earn a total of 1,820 from holding Edinburgh Worldwide Investment or generate 10.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Edinburgh Worldwide Investment vs. VinaCapital Vietnam Opportunit
Performance |
| Timeline |
| Edinburgh Worldwide |
| VinaCapital Vietnam |
Edinburgh Worldwide and VinaCapital Vietnam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edinburgh Worldwide and VinaCapital Vietnam
The main advantage of trading using opposite Edinburgh Worldwide and VinaCapital Vietnam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edinburgh Worldwide position performs unexpectedly, VinaCapital Vietnam 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 VinaCapital Vietnam will offset losses from the drop in VinaCapital Vietnam's long position.| Edinburgh Worldwide vs. iShares MSCI Japan | Edinburgh Worldwide vs. Amundi EUR High | Edinburgh Worldwide vs. iShares JP Morgan | Edinburgh Worldwide vs. Xtrackers MSCI |
| VinaCapital Vietnam vs. iShares MSCI Japan | VinaCapital Vietnam vs. Amundi EUR High | VinaCapital Vietnam vs. iShares JP Morgan | VinaCapital Vietnam vs. Xtrackers MSCI |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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