Correlation Between Saigon Beer and Mechanics Construction
Can any of the company-specific risk be diversified away by investing in both Saigon Beer and Mechanics Construction 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 Saigon Beer and Mechanics Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saigon Beer Alcohol and Mechanics Construction and, you can compare the effects of market volatilities on Saigon Beer and Mechanics Construction 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 Saigon Beer with a short position of Mechanics Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saigon Beer and Mechanics Construction.
Diversification Opportunities for Saigon Beer and Mechanics Construction
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saigon and Mechanics is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Saigon Beer Alcohol and Mechanics Construction and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mechanics Construction and Saigon Beer 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 Saigon Beer Alcohol are associated (or correlated) with Mechanics Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mechanics Construction has no effect on the direction of Saigon Beer i.e., Saigon Beer and Mechanics Construction go up and down completely randomly.
Pair Corralation between Saigon Beer and Mechanics Construction
Assuming the 90 days trading horizon Saigon Beer Alcohol is expected to under-perform the Mechanics Construction. In addition to that, Saigon Beer is 2.6 times more volatile than Mechanics Construction and. It trades about -0.13 of its total potential returns per unit of risk. Mechanics Construction and is currently generating about 0.27 per unit of volatility. If you would invest 860,000 in Mechanics Construction and on October 16, 2024 and sell it today you would earn a total of 10,000 from holding Mechanics Construction and or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 66.67% |
| Values | Daily Returns |
Saigon Beer Alcohol vs. Mechanics Construction and
Performance |
| Timeline |
| Saigon Beer Alcohol |
| Mechanics Construction |
Saigon Beer and Mechanics Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saigon Beer and Mechanics Construction
The main advantage of trading using opposite Saigon Beer and Mechanics Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saigon Beer position performs unexpectedly, Mechanics Construction 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 Mechanics Construction will offset losses from the drop in Mechanics Construction's long position.| Saigon Beer vs. FIT INVEST JSC | Saigon Beer vs. Damsan JSC | Saigon Beer vs. An Phat Plastic | Saigon Beer 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |