Correlation Between Telecoms Informatics and Viettel Construction
Can any of the company-specific risk be diversified away by investing in both Telecoms Informatics 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 Telecoms Informatics and Viettel Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telecoms Informatics JSC and Viettel Construction JSC, you can compare the effects of market volatilities on Telecoms Informatics 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 Telecoms Informatics with a short position of Viettel Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telecoms Informatics and Viettel Construction.
Diversification Opportunities for Telecoms Informatics and Viettel Construction
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Telecoms and Viettel is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Telecoms Informatics JSC 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 Telecoms Informatics 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 Telecoms Informatics JSC 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 Telecoms Informatics i.e., Telecoms Informatics and Viettel Construction go up and down completely randomly.
Pair Corralation between Telecoms Informatics and Viettel Construction
Assuming the 90 days trading horizon Telecoms Informatics JSC is expected to generate 1.12 times more return on investment than Viettel Construction. However, Telecoms Informatics is 1.12 times more volatile than Viettel Construction JSC. It trades about 0.08 of its potential returns per unit of risk. Viettel Construction JSC is currently generating about -0.01 per unit of risk. If you would invest 1,195,000 in Telecoms Informatics JSC on October 18, 2024 and sell it today you would earn a total of 155,000 from holding Telecoms Informatics JSC or generate 12.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telecoms Informatics JSC vs. Viettel Construction JSC
Performance |
| Timeline |
| Telecoms Informatics JSC |
| Viettel Construction JSC |
Telecoms Informatics and Viettel Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telecoms Informatics and Viettel Construction
The main advantage of trading using opposite Telecoms Informatics and Viettel Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telecoms Informatics 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.| Telecoms Informatics vs. PetroVietnam Drilling Well | Telecoms Informatics vs. Fecon Mining JSC | Telecoms Informatics vs. Elcom Technology Communications | Telecoms Informatics vs. Tin Nghia Industrial |
| Viettel Construction vs. POST TELECOMMU | Viettel Construction vs. Telecoms Informatics JSC | Viettel Construction vs. Elcom Technology Communications | Viettel Construction vs. BaoMinh Insurance Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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