Correlation Between Military Insurance and Ha Do
Can any of the company-specific risk be diversified away by investing in both Military Insurance and Ha Do 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 Military Insurance and Ha Do into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Military Insurance Corp and Ha Do Group, you can compare the effects of market volatilities on Military Insurance and Ha Do 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 Military Insurance with a short position of Ha Do. Check out your portfolio center. Please also check ongoing floating volatility patterns of Military Insurance and Ha Do.
Diversification Opportunities for Military Insurance and Ha Do
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Military and HDG is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Military Insurance Corp and Ha Do Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ha Do Group and Military Insurance 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 Military Insurance Corp are associated (or correlated) with Ha Do. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ha Do Group has no effect on the direction of Military Insurance i.e., Military Insurance and Ha Do go up and down completely randomly.
Pair Corralation between Military Insurance and Ha Do
Assuming the 90 days trading horizon Military Insurance is expected to generate 2.25 times less return on investment than Ha Do. But when comparing it to its historical volatility, Military Insurance Corp is 1.41 times less risky than Ha Do. It trades about 0.13 of its potential returns per unit of risk. Ha Do Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,670,000 in Ha Do Group on August 28, 2024 and sell it today you would earn a total of 185,000 from holding Ha Do Group or generate 6.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Military Insurance Corp vs. Ha Do Group
Performance |
| Timeline |
| Military Insurance Corp |
| Ha Do Group |
Military Insurance and Ha Do Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Military Insurance and Ha Do
The main advantage of trading using opposite Military Insurance and Ha Do positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Military Insurance position performs unexpectedly, Ha Do 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 Ha Do will offset losses from the drop in Ha Do's long position.| Military Insurance vs. FIT INVEST JSC | Military Insurance vs. Damsan JSC | Military Insurance vs. An Phat Plastic | Military Insurance vs. APG Securities Joint |
| Ha Do vs. Military Insurance Corp | Ha Do vs. Development Investment Construction | Ha Do vs. Ba Ria Thermal | Ha Do vs. Tien Giang Investment |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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