Correlation Between Plastic Additives and Saigon Beer
Can any of the company-specific risk be diversified away by investing in both Plastic Additives and Saigon Beer 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 Plastic Additives and Saigon Beer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plastic Additives JSC and Saigon Beer Alcohol, you can compare the effects of market volatilities on Plastic Additives and Saigon Beer 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 Plastic Additives with a short position of Saigon Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plastic Additives and Saigon Beer.
Diversification Opportunities for Plastic Additives and Saigon Beer
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Plastic and Saigon is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Plastic Additives JSC and Saigon Beer Alcohol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Beer Alcohol and Plastic Additives 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 Plastic Additives JSC are associated (or correlated) with Saigon Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Beer Alcohol has no effect on the direction of Plastic Additives i.e., Plastic Additives and Saigon Beer go up and down completely randomly.
Pair Corralation between Plastic Additives and Saigon Beer
Assuming the 90 days trading horizon Plastic Additives JSC is expected to generate 5.54 times more return on investment than Saigon Beer. However, Plastic Additives is 5.54 times more volatile than Saigon Beer Alcohol. It trades about 0.28 of its potential returns per unit of risk. Saigon Beer Alcohol is currently generating about 0.03 per unit of risk. If you would invest 840,000 in Plastic Additives JSC on August 31, 2024 and sell it today you would earn a total of 240,000 from holding Plastic Additives JSC or generate 28.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Plastic Additives JSC vs. Saigon Beer Alcohol
Performance |
| Timeline |
| Plastic Additives JSC |
| Saigon Beer Alcohol |
Plastic Additives and Saigon Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plastic Additives and Saigon Beer
The main advantage of trading using opposite Plastic Additives and Saigon Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plastic Additives position performs unexpectedly, Saigon Beer 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 Saigon Beer will offset losses from the drop in Saigon Beer's long position.| Plastic Additives vs. Song Hong Garment | Plastic Additives vs. Alphanam ME | Plastic Additives vs. Hochiminh City Metal | Plastic Additives vs. Atesco Industrial Cartering |
| Saigon Beer vs. FIT INVEST JSC | Saigon Beer vs. Damsan JSC | Saigon Beer vs. An Phat Plastic | Saigon Beer vs. Alphanam ME |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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