Correlation Between Hochiminh City and Din Capital
Can any of the company-specific risk be diversified away by investing in both Hochiminh City and Din Capital 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 Din Capital 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 Din Capital Investment, you can compare the effects of market volatilities on Hochiminh City and Din Capital 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 Din Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochiminh City and Din Capital.
Diversification Opportunities for Hochiminh City and Din Capital
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hochiminh and Din is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Hochiminh City Metal and Din Capital Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Din Capital Investment 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 Din Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Din Capital Investment has no effect on the direction of Hochiminh City i.e., Hochiminh City and Din Capital go up and down completely randomly.
Pair Corralation between Hochiminh City and Din Capital
Assuming the 90 days trading horizon Hochiminh City is expected to generate 1.02 times less return on investment than Din Capital. But when comparing it to its historical volatility, Hochiminh City Metal is 1.81 times less risky than Din Capital. It trades about 0.04 of its potential returns per unit of risk. Din Capital Investment is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 914,286 in Din Capital Investment on August 31, 2024 and sell it today you would earn a total of 105,714 from holding Din Capital Investment or generate 11.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.42% |
| Values | Daily Returns |
Hochiminh City Metal vs. Din Capital Investment
Performance |
| Timeline |
| Hochiminh City Metal |
| Din Capital Investment |
Hochiminh City and Din Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochiminh City and Din Capital
The main advantage of trading using opposite Hochiminh City and Din Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochiminh City position performs unexpectedly, Din Capital 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 Din Capital will offset losses from the drop in Din Capital's long position.| Hochiminh City vs. VTC Telecommunications JSC | Hochiminh City vs. DOMESCO Medical Import | Hochiminh City vs. Elcom Technology Communications | Hochiminh City vs. Tri Viet Management |
| Din Capital vs. FIT INVEST JSC | Din Capital vs. Damsan JSC | Din Capital vs. An Phat Plastic | Din Capital 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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