Correlation Between Fecon Mining and Vietnam National
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and Vietnam National 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 Vietnam National 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 Vietnam National Reinsurance, you can compare the effects of market volatilities on Fecon Mining and Vietnam National 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 Vietnam National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and Vietnam National.
Diversification Opportunities for Fecon Mining and Vietnam National
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fecon and Vietnam is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and Vietnam National Reinsurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam National Rei 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 Vietnam National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam National Rei has no effect on the direction of Fecon Mining i.e., Fecon Mining and Vietnam National go up and down completely randomly.
Pair Corralation between Fecon Mining and Vietnam National
Assuming the 90 days trading horizon Fecon Mining JSC is expected to under-perform the Vietnam National. In addition to that, Fecon Mining is 1.6 times more volatile than Vietnam National Reinsurance. It trades about -0.13 of its total potential returns per unit of risk. Vietnam National Reinsurance is currently generating about 0.0 per unit of volatility. If you would invest 2,297,364 in Vietnam National Reinsurance on September 3, 2024 and sell it today you would lose (7,364) from holding Vietnam National Reinsurance or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.33% |
| Values | Daily Returns |
Fecon Mining JSC vs. Vietnam National Reinsurance
Performance |
| Timeline |
| Fecon Mining JSC |
| Vietnam National Rei |
Fecon Mining and Vietnam National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and Vietnam National
The main advantage of trading using opposite Fecon Mining and Vietnam National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, Vietnam National 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 Vietnam National will offset losses from the drop in Vietnam National'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 |
| Vietnam National vs. FIT INVEST JSC | Vietnam National vs. Damsan JSC | Vietnam National vs. An Phat Plastic | Vietnam National vs. Alphanam ME |
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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