Correlation Between Picomat Plastic and Dong A
Can any of the company-specific risk be diversified away by investing in both Picomat Plastic and Dong A 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 Picomat Plastic and Dong A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Picomat Plastic JSC and Dong A Hotel, you can compare the effects of market volatilities on Picomat Plastic and Dong A 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 Picomat Plastic with a short position of Dong A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Picomat Plastic and Dong A.
Diversification Opportunities for Picomat Plastic and Dong A
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Picomat and Dong is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Picomat Plastic JSC and Dong A Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dong A Hotel and Picomat Plastic 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 Picomat Plastic JSC are associated (or correlated) with Dong A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dong A Hotel has no effect on the direction of Picomat Plastic i.e., Picomat Plastic and Dong A go up and down completely randomly.
Pair Corralation between Picomat Plastic and Dong A
Assuming the 90 days trading horizon Picomat Plastic JSC is expected to generate 0.7 times more return on investment than Dong A. However, Picomat Plastic JSC is 1.42 times less risky than Dong A. It trades about 0.1 of its potential returns per unit of risk. Dong A Hotel is currently generating about 0.03 per unit of risk. If you would invest 1,270,000 in Picomat Plastic JSC on October 22, 2024 and sell it today you would earn a total of 60,000 from holding Picomat Plastic JSC or generate 4.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Picomat Plastic JSC vs. Dong A Hotel
Performance |
| Timeline |
| Picomat Plastic JSC |
| Dong A Hotel |
Picomat Plastic and Dong A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Picomat Plastic and Dong A
The main advantage of trading using opposite Picomat Plastic and Dong A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Picomat Plastic position performs unexpectedly, Dong A 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 Dong A will offset losses from the drop in Dong A's long position.| Picomat Plastic vs. Hai An Transport | Picomat Plastic vs. HUD1 Investment and | Picomat Plastic vs. Thanh Dat Investment | Picomat Plastic vs. Petrolimex Information Technology |
| Dong A vs. Transimex Transportation JSC | Dong A vs. Post and Telecommunications | Dong A vs. PetroVietnam Transportation Corp | Dong A vs. Transport and Industry |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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