Correlation Between Hai An and Viettel Construction
Can any of the company-specific risk be diversified away by investing in both Hai An and Viettel Construction 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 Hai An and Viettel Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hai An Transport and Viettel Construction JSC, you can compare the effects of market volatilities on Hai An and Viettel Construction 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 Hai An with a short position of Viettel Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hai An and Viettel Construction.
Diversification Opportunities for Hai An and Viettel Construction
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hai and Viettel is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Hai An Transport and Viettel Construction JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viettel Construction JSC and Hai An 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 Hai An Transport are associated (or correlated) with Viettel Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viettel Construction JSC has no effect on the direction of Hai An i.e., Hai An and Viettel Construction go up and down completely randomly.
Pair Corralation between Hai An and Viettel Construction
Assuming the 90 days trading horizon Hai An Transport is expected to generate 0.94 times more return on investment than Viettel Construction. However, Hai An Transport is 1.07 times less risky than Viettel Construction. It trades about 0.09 of its potential returns per unit of risk. Viettel Construction JSC is currently generating about 0.07 per unit of risk. If you would invest 3,139,130 in Hai An Transport on September 4, 2024 and sell it today you would earn a total of 1,690,870 from holding Hai An Transport or generate 53.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hai An Transport vs. Viettel Construction JSC
Performance |
| Timeline |
| Hai An Transport |
| Viettel Construction JSC |
Hai An and Viettel Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hai An and Viettel Construction
The main advantage of trading using opposite Hai An and Viettel Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hai An position performs unexpectedly, Viettel Construction 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 Viettel Construction will offset losses from the drop in Viettel Construction's long position.The idea behind Hai An Transport and Viettel Construction JSC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Viettel Construction vs. Tng Investment And | Viettel Construction vs. Everland Investment JSC | Viettel Construction vs. Innovative Technology Development | Viettel Construction vs. LDG Investment JSC |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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