Correlation Between Tien Phong and Picomat Plastic
Can any of the company-specific risk be diversified away by investing in both Tien Phong and Picomat Plastic 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 Tien Phong and Picomat Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tien Phong Plastic and Picomat Plastic JSC, you can compare the effects of market volatilities on Tien Phong and Picomat Plastic 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 Tien Phong with a short position of Picomat Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tien Phong and Picomat Plastic.
Diversification Opportunities for Tien Phong and Picomat Plastic
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tien and Picomat is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Tien Phong Plastic and Picomat Plastic JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Picomat Plastic JSC and Tien Phong 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 Tien Phong Plastic are associated (or correlated) with Picomat Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Picomat Plastic JSC has no effect on the direction of Tien Phong i.e., Tien Phong and Picomat Plastic go up and down completely randomly.
Pair Corralation between Tien Phong and Picomat Plastic
Assuming the 90 days trading horizon Tien Phong is expected to generate 4.44 times less return on investment than Picomat Plastic. But when comparing it to its historical volatility, Tien Phong Plastic is 1.9 times less risky than Picomat Plastic. It trades about 0.04 of its potential returns per unit of risk. Picomat Plastic JSC is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,280,000 in Picomat Plastic JSC on November 7, 2024 and sell it today you would earn a total of 50,000 from holding Picomat Plastic JSC or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tien Phong Plastic vs. Picomat Plastic JSC
Performance |
| Timeline |
| Tien Phong Plastic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Picomat Plastic JSC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Tien Phong and Picomat Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tien Phong and Picomat Plastic
The main advantage of trading using opposite Tien Phong and Picomat Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tien Phong position performs unexpectedly, Picomat Plastic 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 Picomat Plastic will offset losses from the drop in Picomat Plastic's long position.| Tien Phong vs. Vietnam JSCmmercial Bank | Tien Phong vs. HVC Investment and | Tien Phong vs. Innovative Technology Development | Tien Phong vs. Elcom Technology Communications |
| Picomat Plastic vs. FIT INVEST JSC | Picomat Plastic vs. Damsan JSC | Picomat Plastic vs. Binhthuan Agriculture Services | Picomat Plastic vs. Bentre Aquaproduct Import |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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