Correlation Between Sao Ta and Everland Investment
Can any of the company-specific risk be diversified away by investing in both Sao Ta and Everland Investment 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 Sao Ta and Everland Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sao Ta Foods and Everland Investment JSC, you can compare the effects of market volatilities on Sao Ta and Everland Investment 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 Sao Ta with a short position of Everland Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sao Ta and Everland Investment.
Diversification Opportunities for Sao Ta and Everland Investment
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sao and Everland is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Sao Ta Foods and Everland Investment JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everland Investment JSC and Sao Ta 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 Sao Ta Foods are associated (or correlated) with Everland Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everland Investment JSC has no effect on the direction of Sao Ta i.e., Sao Ta and Everland Investment go up and down completely randomly.
Pair Corralation between Sao Ta and Everland Investment
Assuming the 90 days trading horizon Sao Ta Foods is expected to generate 0.31 times more return on investment than Everland Investment. However, Sao Ta Foods is 3.21 times less risky than Everland Investment. It trades about 0.09 of its potential returns per unit of risk. Everland Investment JSC is currently generating about -0.04 per unit of risk. If you would invest 4,610,000 in Sao Ta Foods on August 31, 2024 and sell it today you would earn a total of 70,000 from holding Sao Ta Foods or generate 1.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sao Ta Foods vs. Everland Investment JSC
Performance |
| Timeline |
| Sao Ta Foods |
| Everland Investment JSC |
Sao Ta and Everland Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sao Ta and Everland Investment
The main advantage of trading using opposite Sao Ta and Everland Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sao Ta position performs unexpectedly, Everland Investment 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 Everland Investment will offset losses from the drop in Everland Investment's long position.| Sao Ta vs. Techcom Vietnam REIT | Sao Ta vs. Da Nang Construction | Sao Ta vs. Saigon Viendong Technology | Sao Ta vs. Elcom Technology Communications |
| Everland Investment vs. FPT Digital Retail | Everland Investment vs. Bich Chi Food | Everland Investment vs. Sao Ta Foods | Everland Investment vs. Transport and Industry |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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