Correlation Between Din Capital and Ben Thanh
Can any of the company-specific risk be diversified away by investing in both Din Capital and Ben Thanh 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 Din Capital and Ben Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Din Capital Investment and Ben Thanh Rubber, you can compare the effects of market volatilities on Din Capital and Ben Thanh 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 Din Capital with a short position of Ben Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Din Capital and Ben Thanh.
Diversification Opportunities for Din Capital and Ben Thanh
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Din and Ben is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Din Capital Investment and Ben Thanh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ben Thanh Rubber and Din Capital 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 Din Capital Investment are associated (or correlated) with Ben Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ben Thanh Rubber has no effect on the direction of Din Capital i.e., Din Capital and Ben Thanh go up and down completely randomly.
Pair Corralation between Din Capital and Ben Thanh
Assuming the 90 days trading horizon Din Capital is expected to generate 21.36 times less return on investment than Ben Thanh. But when comparing it to its historical volatility, Din Capital Investment is 1.02 times less risky than Ben Thanh. It trades about 0.01 of its potential returns per unit of risk. Ben Thanh Rubber is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,405,000 in Ben Thanh Rubber on October 12, 2024 and sell it today you would earn a total of 35,000 from holding Ben Thanh Rubber or generate 2.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Din Capital Investment vs. Ben Thanh Rubber
Performance |
| Timeline |
| Din Capital Investment |
| Ben Thanh Rubber |
Din Capital and Ben Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Din Capital and Ben Thanh
The main advantage of trading using opposite Din Capital and Ben Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Din Capital position performs unexpectedly, Ben Thanh 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 Ben Thanh will offset losses from the drop in Ben Thanh's long position.| Din Capital vs. FIT INVEST JSC | Din Capital vs. Damsan JSC | Din Capital vs. An Phat Plastic | Din Capital vs. APG Securities Joint |
| Ben Thanh vs. Hochiminh City Metal | Ben Thanh vs. Vietnam JSCmmercial Bank | Ben Thanh vs. Elcom Technology Communications | Ben Thanh vs. Ba Ria Thermal |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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