Correlation Between Hochiminh City and Agriculture Printing
Can any of the company-specific risk be diversified away by investing in both Hochiminh City and Agriculture Printing 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 Hochiminh City and Agriculture Printing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hochiminh City Metal and Agriculture Printing and, you can compare the effects of market volatilities on Hochiminh City and Agriculture Printing 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 Hochiminh City with a short position of Agriculture Printing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochiminh City and Agriculture Printing.
Diversification Opportunities for Hochiminh City and Agriculture Printing
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hochiminh and Agriculture is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Hochiminh City Metal and Agriculture Printing and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agriculture Printing and and Hochiminh City 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 Hochiminh City Metal are associated (or correlated) with Agriculture Printing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agriculture Printing and has no effect on the direction of Hochiminh City i.e., Hochiminh City and Agriculture Printing go up and down completely randomly.
Pair Corralation between Hochiminh City and Agriculture Printing
Assuming the 90 days trading horizon Hochiminh City Metal is expected to under-perform the Agriculture Printing. But the stock apears to be less risky and, when comparing its historical volatility, Hochiminh City Metal is 1.12 times less risky than Agriculture Printing. The stock trades about -0.01 of its potential returns per unit of risk. The Agriculture Printing and is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,200,000 in Agriculture Printing and on September 3, 2024 and sell it today you would earn a total of 220,000 from holding Agriculture Printing and or generate 4.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 92.91% |
| Values | Daily Returns |
Hochiminh City Metal vs. Agriculture Printing and
Performance |
| Timeline |
| Hochiminh City Metal |
| Agriculture Printing and |
Hochiminh City and Agriculture Printing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochiminh City and Agriculture Printing
The main advantage of trading using opposite Hochiminh City and Agriculture Printing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochiminh City position performs unexpectedly, Agriculture Printing 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 Agriculture Printing will offset losses from the drop in Agriculture Printing's long position.| Hochiminh City vs. Tien Phong Plastic | Hochiminh City vs. Southern Rubber Industry | Hochiminh City vs. Saigon Telecommunication Technologies | Hochiminh City vs. VTC Telecommunications JSC |
| Agriculture Printing vs. FIT INVEST JSC | Agriculture Printing vs. Damsan JSC | Agriculture Printing vs. An Phat Plastic | Agriculture Printing 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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