Correlation Between Picomat Plastic and Pha Le
Can any of the company-specific risk be diversified away by investing in both Picomat Plastic and Pha Le 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 Pha Le 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 Pha Le Plastics, you can compare the effects of market volatilities on Picomat Plastic and Pha Le 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 Pha Le. Check out your portfolio center. Please also check ongoing floating volatility patterns of Picomat Plastic and Pha Le.
Diversification Opportunities for Picomat Plastic and Pha Le
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Picomat and Pha is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Picomat Plastic JSC and Pha Le Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Le Plastics 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 Pha Le. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Le Plastics has no effect on the direction of Picomat Plastic i.e., Picomat Plastic and Pha Le go up and down completely randomly.
Pair Corralation between Picomat Plastic and Pha Le
Assuming the 90 days trading horizon Picomat Plastic is expected to generate 2.55 times less return on investment than Pha Le. In addition to that, Picomat Plastic is 1.42 times more volatile than Pha Le Plastics. It trades about 0.1 of its total potential returns per unit of risk. Pha Le Plastics is currently generating about 0.38 per unit of volatility. If you would invest 450,000 in Pha Le Plastics on October 22, 2024 and sell it today you would earn a total of 66,000 from holding Pha Le Plastics or generate 14.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Picomat Plastic JSC vs. Pha Le Plastics
Performance |
| Timeline |
| Picomat Plastic JSC |
| Pha Le Plastics |
Picomat Plastic and Pha Le Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Picomat Plastic and Pha Le
The main advantage of trading using opposite Picomat Plastic and Pha Le positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Picomat Plastic position performs unexpectedly, Pha Le 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 Pha Le will offset losses from the drop in Pha Le'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 |
| Pha Le vs. Vina2 Investment and | Pha Le vs. TDT Investment and | Pha Le vs. PC3 Investment JSC | Pha Le vs. MST Investment JSC |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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