Correlation Between Duc Thanh and Vincom Retail
Can any of the company-specific risk be diversified away by investing in both Duc Thanh and Vincom Retail 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 Duc Thanh and Vincom Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duc Thanh Wood and Vincom Retail JSC, you can compare the effects of market volatilities on Duc Thanh and Vincom Retail 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 Duc Thanh with a short position of Vincom Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duc Thanh and Vincom Retail.
Diversification Opportunities for Duc Thanh and Vincom Retail
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Duc and Vincom is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Duc Thanh Wood and Vincom Retail JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vincom Retail JSC and Duc Thanh 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 Duc Thanh Wood are associated (or correlated) with Vincom Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vincom Retail JSC has no effect on the direction of Duc Thanh i.e., Duc Thanh and Vincom Retail go up and down completely randomly.
Pair Corralation between Duc Thanh and Vincom Retail
Assuming the 90 days trading horizon Duc Thanh Wood is expected to under-perform the Vincom Retail. In addition to that, Duc Thanh is 1.19 times more volatile than Vincom Retail JSC. It trades about -0.2 of its total potential returns per unit of risk. Vincom Retail JSC is currently generating about -0.16 per unit of volatility. If you would invest 1,785,000 in Vincom Retail JSC on September 1, 2024 and sell it today you would lose (105,000) from holding Vincom Retail JSC or give up 5.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duc Thanh Wood vs. Vincom Retail JSC
Performance |
| Timeline |
| Duc Thanh Wood |
| Vincom Retail JSC |
Duc Thanh and Vincom Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duc Thanh and Vincom Retail
The main advantage of trading using opposite Duc Thanh and Vincom Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duc Thanh position performs unexpectedly, Vincom Retail 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 Vincom Retail will offset losses from the drop in Vincom Retail's long position.| Duc Thanh vs. FIT INVEST JSC | Duc Thanh vs. Damsan JSC | Duc Thanh vs. An Phat Plastic | Duc Thanh vs. Alphanam ME |
| Vincom Retail vs. FIT INVEST JSC | Vincom Retail vs. Damsan JSC | Vincom Retail vs. An Phat Plastic | Vincom Retail 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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