Correlation Between LDG Investment and Viettel Construction
Can any of the company-specific risk be diversified away by investing in both LDG Investment 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 LDG Investment and Viettel Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LDG Investment JSC and Viettel Construction JSC, you can compare the effects of market volatilities on LDG Investment 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 LDG Investment with a short position of Viettel Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of LDG Investment and Viettel Construction.
Diversification Opportunities for LDG Investment and Viettel Construction
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between LDG and Viettel is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding LDG Investment 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 LDG 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 LDG Investment 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 LDG Investment i.e., LDG Investment and Viettel Construction go up and down completely randomly.
Pair Corralation between LDG Investment and Viettel Construction
Assuming the 90 days trading horizon LDG Investment JSC is expected to under-perform the Viettel Construction. But the stock apears to be less risky and, when comparing its historical volatility, LDG Investment JSC is 1.55 times less risky than Viettel Construction. The stock trades about -0.01 of its potential returns per unit of risk. The Viettel Construction JSC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 12,400,000 in Viettel Construction JSC on September 5, 2024 and sell it today you would earn a total of 100,000 from holding Viettel Construction JSC or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LDG Investment JSC vs. Viettel Construction JSC
Performance |
| Timeline |
| LDG Investment JSC |
| Viettel Construction JSC |
LDG Investment and Viettel Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LDG Investment and Viettel Construction
The main advantage of trading using opposite LDG Investment and Viettel Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LDG Investment 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.| LDG Investment vs. FIT INVEST JSC | LDG Investment vs. Damsan JSC | LDG Investment vs. An Phat Plastic | LDG Investment vs. Alphanam ME |
| Viettel Construction vs. FIT INVEST JSC | Viettel Construction vs. Damsan JSC | Viettel Construction vs. An Phat Plastic | Viettel Construction 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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