Correlation Between Vietnam Rubber and Bich Chi
Can any of the company-specific risk be diversified away by investing in both Vietnam Rubber and Bich Chi 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 Vietnam Rubber and Bich Chi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam Rubber Group and Bich Chi Food, you can compare the effects of market volatilities on Vietnam Rubber and Bich Chi 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 Vietnam Rubber with a short position of Bich Chi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam Rubber and Bich Chi.
Diversification Opportunities for Vietnam Rubber and Bich Chi
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vietnam and Bich is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Rubber Group and Bich Chi Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bich Chi Food and Vietnam Rubber 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 Vietnam Rubber Group are associated (or correlated) with Bich Chi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bich Chi Food has no effect on the direction of Vietnam Rubber i.e., Vietnam Rubber and Bich Chi go up and down completely randomly.
Pair Corralation between Vietnam Rubber and Bich Chi
Assuming the 90 days trading horizon Vietnam Rubber Group is expected to under-perform the Bich Chi. But the stock apears to be less risky and, when comparing its historical volatility, Vietnam Rubber Group is 1.64 times less risky than Bich Chi. The stock trades about -0.07 of its potential returns per unit of risk. The Bich Chi Food is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4,000,000 in Bich Chi Food on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Bich Chi Food or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 45.45% |
| Values | Daily Returns |
Vietnam Rubber Group vs. Bich Chi Food
Performance |
| Timeline |
| Vietnam Rubber Group |
| Bich Chi Food |
Vietnam Rubber and Bich Chi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vietnam Rubber and Bich Chi
The main advantage of trading using opposite Vietnam Rubber and Bich Chi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam Rubber position performs unexpectedly, Bich Chi 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 Bich Chi will offset losses from the drop in Bich Chi's long position.| Vietnam Rubber vs. Pha Lai Thermal | Vietnam Rubber vs. BIDV Insurance Corp | Vietnam Rubber vs. Telecoms Informatics JSC | Vietnam Rubber vs. Hochiminh City Metal |
| Bich Chi vs. Dong Nai Plastic | Bich Chi vs. Tay Ninh Rubber | Bich Chi vs. Vietnam Rubber Group | Bich Chi vs. Hung Hau Agricultural |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |