Correlation Between Sao Ta and Saigon Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Sao Ta and Saigon Telecommunicatio 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 Saigon Telecommunicatio 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 Saigon Telecommunication Technologies, you can compare the effects of market volatilities on Sao Ta and Saigon Telecommunicatio 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 Saigon Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sao Ta and Saigon Telecommunicatio.
Diversification Opportunities for Sao Ta and Saigon Telecommunicatio
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sao and Saigon is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Sao Ta Foods and Saigon Telecommunication Techn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Telecommunicatio 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 Saigon Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Telecommunicatio has no effect on the direction of Sao Ta i.e., Sao Ta and Saigon Telecommunicatio go up and down completely randomly.
Pair Corralation between Sao Ta and Saigon Telecommunicatio
Assuming the 90 days trading horizon Sao Ta Foods is expected to generate 0.47 times more return on investment than Saigon Telecommunicatio. However, Sao Ta Foods is 2.14 times less risky than Saigon Telecommunicatio. It trades about 0.13 of its potential returns per unit of risk. Saigon Telecommunication Technologies is currently generating about -0.02 per unit of risk. If you would invest 4,570,000 in Sao Ta Foods on August 29, 2024 and sell it today you would earn a total of 105,000 from holding Sao Ta Foods or generate 2.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sao Ta Foods vs. Saigon Telecommunication Techn
Performance |
| Timeline |
| Sao Ta Foods |
| Saigon Telecommunicatio |
Sao Ta and Saigon Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sao Ta and Saigon Telecommunicatio
The main advantage of trading using opposite Sao Ta and Saigon Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sao Ta position performs unexpectedly, Saigon Telecommunicatio 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 Saigon Telecommunicatio will offset losses from the drop in Saigon Telecommunicatio's long position.| Sao Ta vs. FIT INVEST JSC | Sao Ta vs. Damsan JSC | Sao Ta vs. An Phat Plastic | Sao Ta vs. APG Securities Joint |
| Saigon Telecommunicatio vs. FIT INVEST JSC | Saigon Telecommunicatio vs. Damsan JSC | Saigon Telecommunicatio vs. An Phat Plastic | Saigon Telecommunicatio vs. APG Securities Joint |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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