Correlation Between Pha Lai and Ba Ria
Can any of the company-specific risk be diversified away by investing in both Pha Lai and Ba Ria 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 Pha Lai and Ba Ria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pha Lai Thermal and Ba Ria Thermal, you can compare the effects of market volatilities on Pha Lai and Ba Ria 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 Pha Lai with a short position of Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pha Lai and Ba Ria.
Diversification Opportunities for Pha Lai and Ba Ria
Weak diversification
The 3 months correlation between Pha and BTP is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Pha Lai Thermal and Ba Ria Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ba Ria Thermal and Pha Lai 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 Pha Lai Thermal are associated (or correlated) with Ba Ria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ba Ria Thermal has no effect on the direction of Pha Lai i.e., Pha Lai and Ba Ria go up and down completely randomly.
Pair Corralation between Pha Lai and Ba Ria
Assuming the 90 days trading horizon Pha Lai Thermal is expected to under-perform the Ba Ria. In addition to that, Pha Lai is 2.01 times more volatile than Ba Ria Thermal. It trades about -0.38 of its total potential returns per unit of risk. Ba Ria Thermal is currently generating about -0.51 per unit of volatility. If you would invest 1,230,000 in Ba Ria Thermal on August 25, 2024 and sell it today you would lose (90,000) from holding Ba Ria Thermal or give up 7.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pha Lai Thermal vs. Ba Ria Thermal
Performance |
| Timeline |
| Pha Lai Thermal |
| Ba Ria Thermal |
Pha Lai and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pha Lai and Ba Ria
The main advantage of trading using opposite Pha Lai and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pha Lai position performs unexpectedly, Ba Ria 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 Ba Ria will offset losses from the drop in Ba Ria's long position.| Pha Lai vs. FIT INVEST JSC | Pha Lai vs. Damsan JSC | Pha Lai vs. An Phat Plastic | Pha Lai vs. APG Securities Joint |
| Ba Ria vs. FIT INVEST JSC | Ba Ria vs. Damsan JSC | Ba Ria vs. An Phat Plastic | Ba Ria vs. APG Securities Joint |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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