Correlation Between FPT Digital and Vietnam JSCmmercial
Can any of the company-specific risk be diversified away by investing in both FPT Digital and Vietnam JSCmmercial 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 FPT Digital and Vietnam JSCmmercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FPT Digital Retail and Vietnam JSCmmercial Bank, you can compare the effects of market volatilities on FPT Digital and Vietnam JSCmmercial 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 FPT Digital with a short position of Vietnam JSCmmercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of FPT Digital and Vietnam JSCmmercial.
Diversification Opportunities for FPT Digital and Vietnam JSCmmercial
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FPT and Vietnam is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding FPT Digital Retail and Vietnam JSCmmercial Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vietnam JSCmmercial Bank and FPT Digital 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 FPT Digital Retail are associated (or correlated) with Vietnam JSCmmercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vietnam JSCmmercial Bank has no effect on the direction of FPT Digital i.e., FPT Digital and Vietnam JSCmmercial go up and down completely randomly.
Pair Corralation between FPT Digital and Vietnam JSCmmercial
Assuming the 90 days trading horizon FPT Digital Retail is expected to generate 0.98 times more return on investment than Vietnam JSCmmercial. However, FPT Digital Retail is 1.02 times less risky than Vietnam JSCmmercial. It trades about 0.15 of its potential returns per unit of risk. Vietnam JSCmmercial Bank is currently generating about 0.08 per unit of risk. If you would invest 10,110,000 in FPT Digital Retail on September 3, 2024 and sell it today you would earn a total of 7,870,000 from holding FPT Digital Retail or generate 77.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FPT Digital Retail vs. Vietnam JSCmmercial Bank
Performance |
| Timeline |
| FPT Digital Retail |
| Vietnam JSCmmercial Bank |
FPT Digital and Vietnam JSCmmercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FPT Digital and Vietnam JSCmmercial
The main advantage of trading using opposite FPT Digital and Vietnam JSCmmercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FPT Digital position performs unexpectedly, Vietnam JSCmmercial 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 JSCmmercial will offset losses from the drop in Vietnam JSCmmercial's long position.| FPT Digital vs. Fecon Mining JSC | FPT Digital vs. Vincom Retail JSC | FPT Digital vs. POST TELECOMMU | FPT Digital vs. VTC Telecommunications JSC |
| Vietnam JSCmmercial vs. FIT INVEST JSC | Vietnam JSCmmercial vs. Damsan JSC | Vietnam JSCmmercial vs. An Phat Plastic | Vietnam JSCmmercial 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 CEOs Directory module to screen CEOs from public companies around the world.
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