Correlation Between Fecon Mining and Pha Lai
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and Pha Lai 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 Pha Lai 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 Pha Lai Thermal, you can compare the effects of market volatilities on Fecon Mining and Pha Lai 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 Pha Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and Pha Lai.
Diversification Opportunities for Fecon Mining and Pha Lai
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fecon and Pha is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and Pha Lai Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Lai Thermal 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 Pha Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Lai Thermal has no effect on the direction of Fecon Mining i.e., Fecon Mining and Pha Lai go up and down completely randomly.
Pair Corralation between Fecon Mining and Pha Lai
Assuming the 90 days trading horizon Fecon Mining JSC is expected to under-perform the Pha Lai. But the stock apears to be less risky and, when comparing its historical volatility, Fecon Mining JSC is 1.16 times less risky than Pha Lai. The stock trades about -0.12 of its potential returns per unit of risk. The Pha Lai Thermal is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,197,142 in Pha Lai Thermal on September 4, 2024 and sell it today you would lose (87,142) from holding Pha Lai Thermal or give up 7.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Fecon Mining JSC vs. Pha Lai Thermal
Performance |
| Timeline |
| Fecon Mining JSC |
| Pha Lai Thermal |
Fecon Mining and Pha Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and Pha Lai
The main advantage of trading using opposite Fecon Mining and Pha Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, Pha Lai 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 Pha Lai will offset losses from the drop in Pha Lai's long position.| Fecon Mining vs. FIT INVEST JSC | Fecon Mining vs. Damsan JSC | Fecon Mining vs. An Phat Plastic | Fecon Mining vs. Alphanam ME |
| Pha Lai vs. Elcom Technology Communications | Pha Lai vs. Dong Nai Plastic | Pha Lai vs. Phuoc Hoa Rubber | Pha Lai vs. Telecoms Informatics JSC |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |