Correlation Between Global Electrical and Vinacontrol Group
Can any of the company-specific risk be diversified away by investing in both Global Electrical and Vinacontrol Group 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 Global Electrical and Vinacontrol Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Electrical Technology and Vinacontrol Group Corp, you can compare the effects of market volatilities on Global Electrical and Vinacontrol Group 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 Global Electrical with a short position of Vinacontrol Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Electrical and Vinacontrol Group.
Diversification Opportunities for Global Electrical and Vinacontrol Group
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Global and Vinacontrol is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Global Electrical Technology and Vinacontrol Group Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vinacontrol Group Corp and Global Electrical 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 Global Electrical Technology are associated (or correlated) with Vinacontrol Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vinacontrol Group Corp has no effect on the direction of Global Electrical i.e., Global Electrical and Vinacontrol Group go up and down completely randomly.
Pair Corralation between Global Electrical and Vinacontrol Group
Assuming the 90 days trading horizon Global Electrical Technology is expected to generate 2.61 times more return on investment than Vinacontrol Group. However, Global Electrical is 2.61 times more volatile than Vinacontrol Group Corp. It trades about 0.27 of its potential returns per unit of risk. Vinacontrol Group Corp is currently generating about -0.06 per unit of risk. If you would invest 2,570,000 in Global Electrical Technology on October 20, 2024 and sell it today you would earn a total of 60,000 from holding Global Electrical Technology or generate 2.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 29.41% |
| Values | Daily Returns |
Global Electrical Technology vs. Vinacontrol Group Corp
Performance |
| Timeline |
| Global Electrical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Vinacontrol Group Corp |
Global Electrical and Vinacontrol Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Electrical and Vinacontrol Group
The main advantage of trading using opposite Global Electrical and Vinacontrol Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Electrical position performs unexpectedly, Vinacontrol Group 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 Vinacontrol Group will offset losses from the drop in Vinacontrol Group's long position.| Global Electrical vs. Tien Phong Plastic | Global Electrical vs. An Phat Holdings | Global Electrical vs. FPT Corp | Global Electrical vs. POST TELECOMMU |
| Vinacontrol Group vs. An Phat Plastic | Vinacontrol Group vs. Telecoms Informatics JSC | Vinacontrol Group vs. VTC Telecommunications JSC | Vinacontrol Group vs. Tien Giang Investment |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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