Correlation Between Song Hong and Kien Giang
Can any of the company-specific risk be diversified away by investing in both Song Hong and Kien Giang 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 Song Hong and Kien Giang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Song Hong Aluminum and Kien Giang Construction, you can compare the effects of market volatilities on Song Hong and Kien Giang 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 Song Hong with a short position of Kien Giang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Song Hong and Kien Giang.
Diversification Opportunities for Song Hong and Kien Giang
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Song and Kien is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Song Hong Aluminum and Kien Giang Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kien Giang Construction and Song Hong 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 Song Hong Aluminum are associated (or correlated) with Kien Giang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kien Giang Construction has no effect on the direction of Song Hong i.e., Song Hong and Kien Giang go up and down completely randomly.
Pair Corralation between Song Hong and Kien Giang
Assuming the 90 days trading horizon Song Hong Aluminum is expected to generate 1.12 times more return on investment than Kien Giang. However, Song Hong is 1.12 times more volatile than Kien Giang Construction. It trades about -0.11 of its potential returns per unit of risk. Kien Giang Construction is currently generating about -0.15 per unit of risk. If you would invest 490,000 in Song Hong Aluminum on August 28, 2024 and sell it today you would lose (30,000) from holding Song Hong Aluminum or give up 6.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Song Hong Aluminum vs. Kien Giang Construction
Performance |
| Timeline |
| Song Hong Aluminum |
| Kien Giang Construction |
Song Hong and Kien Giang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Song Hong and Kien Giang
The main advantage of trading using opposite Song Hong and Kien Giang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Song Hong position performs unexpectedly, Kien Giang 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 Kien Giang will offset losses from the drop in Kien Giang's long position.| Song Hong vs. FIT INVEST JSC | Song Hong vs. Damsan JSC | Song Hong vs. An Phat Plastic | Song Hong vs. APG Securities Joint |
| Kien Giang vs. FIT INVEST JSC | Kien Giang vs. Damsan JSC | Kien Giang vs. An Phat Plastic | Kien Giang vs. APG Securities Joint |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |