Correlation Between POST TELECOMMU and Saigon Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both POST TELECOMMU and Saigon Telecommunicatio 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 POST TELECOMMU and Saigon Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POST TELECOMMU and Saigon Telecommunication Technologies, you can compare the effects of market volatilities on POST TELECOMMU and Saigon Telecommunicatio 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 POST TELECOMMU with a short position of Saigon Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of POST TELECOMMU and Saigon Telecommunicatio.
Diversification Opportunities for POST TELECOMMU and Saigon Telecommunicatio
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between POST and Saigon is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding POST TELECOMMU and Saigon Telecommunication Techn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saigon Telecommunicatio and POST TELECOMMU 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 POST TELECOMMU are associated (or correlated) with Saigon Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saigon Telecommunicatio has no effect on the direction of POST TELECOMMU i.e., POST TELECOMMU and Saigon Telecommunicatio go up and down completely randomly.
Pair Corralation between POST TELECOMMU and Saigon Telecommunicatio
Assuming the 90 days trading horizon POST TELECOMMU is expected to under-perform the Saigon Telecommunicatio. In addition to that, POST TELECOMMU is 1.22 times more volatile than Saigon Telecommunication Technologies. It trades about 0.0 of its total potential returns per unit of risk. Saigon Telecommunication Technologies is currently generating about 0.11 per unit of volatility. If you would invest 1,185,000 in Saigon Telecommunication Technologies on November 1, 2024 and sell it today you would earn a total of 800,000 from holding Saigon Telecommunication Technologies or generate 67.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.31% |
| Values | Daily Returns |
POST TELECOMMU vs. Saigon Telecommunication Techn
Performance |
| Timeline |
| POST TELECOMMU |
| Saigon Telecommunicatio |
POST TELECOMMU and Saigon Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POST TELECOMMU and Saigon Telecommunicatio
The main advantage of trading using opposite POST TELECOMMU and Saigon Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POST TELECOMMU position performs unexpectedly, Saigon Telecommunicatio 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 Telecommunicatio will offset losses from the drop in Saigon Telecommunicatio's long position.| POST TELECOMMU vs. Techno Agricultural Supplying | POST TELECOMMU vs. PetroVietnam Drilling Well | POST TELECOMMU vs. Binh Minh Plastics | POST TELECOMMU vs. Hanoi Plastics JSC |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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