Correlation Between HVC Investment and Pha Lai
Can any of the company-specific risk be diversified away by investing in both HVC Investment and Pha Lai 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 HVC Investment and Pha Lai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HVC Investment and and Pha Lai Thermal, you can compare the effects of market volatilities on HVC Investment and Pha Lai 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 HVC Investment with a short position of Pha Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of HVC Investment and Pha Lai.
Diversification Opportunities for HVC Investment and Pha Lai
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between HVC and Pha is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding HVC Investment and and Pha Lai Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Lai Thermal and HVC Investment 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 HVC Investment and are associated (or correlated) with Pha Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Lai Thermal has no effect on the direction of HVC Investment i.e., HVC Investment and Pha Lai go up and down completely randomly.
Pair Corralation between HVC Investment and Pha Lai
Assuming the 90 days trading horizon HVC Investment and is expected to generate 1.34 times more return on investment than Pha Lai. However, HVC Investment is 1.34 times more volatile than Pha Lai Thermal. It trades about 0.07 of its potential returns per unit of risk. Pha Lai Thermal is currently generating about 0.03 per unit of risk. If you would invest 470,000 in HVC Investment and on September 13, 2024 and sell it today you would earn a total of 420,000 from holding HVC Investment and or generate 89.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HVC Investment and vs. Pha Lai Thermal
Performance |
| Timeline |
| HVC Investment |
| Pha Lai Thermal |
HVC Investment and Pha Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HVC Investment and Pha Lai
The main advantage of trading using opposite HVC Investment and Pha Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HVC Investment position performs unexpectedly, Pha Lai 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 Pha Lai will offset losses from the drop in Pha Lai's long position.| HVC Investment vs. PetroVietnam Transportation Corp | HVC Investment vs. Techno Agricultural Supplying | HVC Investment vs. Telecoms Informatics JSC | HVC Investment vs. Da Nang Construction |
| Pha Lai vs. Thanh Dat Investment | Pha Lai vs. Nafoods Group JSC | Pha Lai vs. MST Investment JSC | Pha Lai vs. Tng Investment And |
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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