Correlation Between Hai An and Picomat Plastic
Can any of the company-specific risk be diversified away by investing in both Hai An and Picomat Plastic 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 Picomat Plastic 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 Picomat Plastic JSC, you can compare the effects of market volatilities on Hai An and Picomat Plastic 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 Picomat Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hai An and Picomat Plastic.
Diversification Opportunities for Hai An and Picomat Plastic
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hai and Picomat is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Hai An Transport and Picomat Plastic JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Picomat Plastic 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 Picomat Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Picomat Plastic JSC has no effect on the direction of Hai An i.e., Hai An and Picomat Plastic go up and down completely randomly.
Pair Corralation between Hai An and Picomat Plastic
Assuming the 90 days trading horizon Hai An is expected to generate 1.13 times less return on investment than Picomat Plastic. But when comparing it to its historical volatility, Hai An Transport is 1.1 times less risky than Picomat Plastic. It trades about 0.08 of its potential returns per unit of risk. Picomat Plastic JSC is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 510,000 in Picomat Plastic JSC on October 18, 2024 and sell it today you would earn a total of 830,000 from holding Picomat Plastic JSC or generate 162.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Hai An Transport vs. Picomat Plastic JSC
Performance |
| Timeline |
| Hai An Transport |
| Picomat Plastic JSC |
Hai An and Picomat Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hai An and Picomat Plastic
The main advantage of trading using opposite Hai An and Picomat Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hai An position performs unexpectedly, Picomat Plastic 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 Picomat Plastic will offset losses from the drop in Picomat Plastic's long position.| Hai An vs. Binh Duong Trade | Hai An vs. Picomat Plastic JSC | Hai An vs. Tienlen Steel Corp | Hai An vs. Elcom Technology Communications |
| Picomat Plastic vs. Pha Lai Thermal | Picomat Plastic vs. Century Synthetic Fiber | Picomat Plastic vs. Vietnam Petroleum Transport | Picomat Plastic vs. Hai An Transport |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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