Correlation Between Fecon Mining and Hanoi Beer
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and Hanoi Beer 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 Fecon Mining and Hanoi Beer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fecon Mining JSC and Hanoi Beer Trading, you can compare the effects of market volatilities on Fecon Mining and Hanoi Beer 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 Fecon Mining with a short position of Hanoi Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and Hanoi Beer.
Diversification Opportunities for Fecon Mining and Hanoi Beer
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fecon and Hanoi is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and Hanoi Beer Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanoi Beer Trading and Fecon Mining 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 Fecon Mining JSC are associated (or correlated) with Hanoi Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanoi Beer Trading has no effect on the direction of Fecon Mining i.e., Fecon Mining and Hanoi Beer go up and down completely randomly.
Pair Corralation between Fecon Mining and Hanoi Beer
Assuming the 90 days trading horizon Fecon Mining JSC is expected to under-perform the Hanoi Beer. But the stock apears to be less risky and, when comparing its historical volatility, Fecon Mining JSC is 3.18 times less risky than Hanoi Beer. The stock trades about -0.1 of its potential returns per unit of risk. The Hanoi Beer Trading is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,262,952 in Hanoi Beer Trading on September 14, 2024 and sell it today you would earn a total of 987,048 from holding Hanoi Beer Trading or generate 30.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 50.19% |
| Values | Daily Returns |
Fecon Mining JSC vs. Hanoi Beer Trading
Performance |
| Timeline |
| Fecon Mining JSC |
| Hanoi Beer Trading |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Fecon Mining and Hanoi Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and Hanoi Beer
The main advantage of trading using opposite Fecon Mining and Hanoi Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, Hanoi Beer 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 Hanoi Beer will offset losses from the drop in Hanoi Beer's long position.| Fecon Mining vs. Danang Rubber JSC | Fecon Mining vs. DIC Holdings Construction | Fecon Mining vs. FPT Digital Retail | Fecon Mining vs. Binh Duong Trade |
| Hanoi Beer vs. Hochiminh City Metal | Hanoi Beer vs. Nafoods Group JSC | Hanoi Beer vs. Fecon Mining JSC | Hanoi Beer vs. Post and Telecommunications |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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