Correlation Between POT and Saigon Viendong
Can any of the company-specific risk be diversified away by investing in both POT and Saigon Viendong 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 POT and Saigon Viendong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PostTelecommunication Equipment and Saigon Viendong Technology, you can compare the effects of market volatilities on POT and Saigon Viendong 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 POT with a short position of Saigon Viendong. Check out your portfolio center. Please also check ongoing floating volatility patterns of POT and Saigon Viendong.
Diversification Opportunities for POT and Saigon Viendong
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between POT and Saigon is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding PostTelecommunication Equipmen and Saigon Viendong Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Viendong Tech and POT 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 PostTelecommunication Equipment are associated (or correlated) with Saigon Viendong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Viendong Tech has no effect on the direction of POT i.e., POT and Saigon Viendong go up and down completely randomly.
Pair Corralation between POT and Saigon Viendong
Assuming the 90 days trading horizon PostTelecommunication Equipment is expected to generate 1.24 times more return on investment than Saigon Viendong. However, POT is 1.24 times more volatile than Saigon Viendong Technology. It trades about 0.34 of its potential returns per unit of risk. Saigon Viendong Technology is currently generating about 0.01 per unit of risk. If you would invest 1,470,000 in PostTelecommunication Equipment on November 7, 2024 and sell it today you would earn a total of 100,000 from holding PostTelecommunication Equipment or generate 6.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 47.06% |
| Values | Daily Returns |
PostTelecommunication Equipmen vs. Saigon Viendong Technology
Performance |
| Timeline |
| PostTelecommunication |
| Saigon Viendong Tech |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
POT and Saigon Viendong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POT and Saigon Viendong
The main advantage of trading using opposite POT and Saigon Viendong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POT position performs unexpectedly, Saigon Viendong 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 Viendong will offset losses from the drop in Saigon Viendong's long position.| POT vs. HVC Investment and | POT vs. Hai An Transport | POT vs. HUD1 Investment and | POT vs. Vietnam Technological And |
| Saigon Viendong vs. HVC Investment and | Saigon Viendong vs. Transport and Industry | Saigon Viendong vs. Vietnam Technological And | Saigon Viendong vs. Binhthuan Agriculture Services |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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