Correlation Between MST Investment and Create Capital
Can any of the company-specific risk be diversified away by investing in both MST Investment and Create 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 MST Investment and Create Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MST Investment JSC and Create Capital Vietnam, you can compare the effects of market volatilities on MST Investment and Create 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 MST Investment with a short position of Create Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of MST Investment and Create Capital.
Diversification Opportunities for MST Investment and Create Capital
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between MST and Create is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding MST Investment JSC and Create Capital Vietnam in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Create Capital Vietnam and MST 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 MST Investment JSC are associated (or correlated) with Create Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Create Capital Vietnam has no effect on the direction of MST Investment i.e., MST Investment and Create Capital go up and down completely randomly.
Pair Corralation between MST Investment and Create Capital
Assuming the 90 days trading horizon MST Investment JSC is expected to generate 11.0 times more return on investment than Create Capital. However, MST Investment is 11.0 times more volatile than Create Capital Vietnam. It trades about 0.04 of its potential returns per unit of risk. Create Capital Vietnam is currently generating about -0.26 per unit of risk. If you would invest 720,000 in MST Investment JSC on October 25, 2024 and sell it today you would earn a total of 10,000 from holding MST Investment JSC or generate 1.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
MST Investment JSC vs. Create Capital Vietnam
Performance |
| Timeline |
| MST Investment JSC |
| Create Capital Vietnam |
MST Investment and Create Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MST Investment and Create Capital
The main advantage of trading using opposite MST Investment and Create Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MST Investment position performs unexpectedly, Create 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 Create Capital will offset losses from the drop in Create Capital's long position.| MST Investment vs. FIT INVEST JSC | MST Investment vs. Damsan JSC | MST Investment vs. An Phat Plastic | MST Investment vs. APG Securities Joint |
| Create Capital vs. Vnsteel Vicasa JSC | Create Capital vs. Tienlen Steel Corp | Create Capital vs. MST Investment JSC | Create Capital vs. Vina2 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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