Correlation Between Sea Air and Ha Noi
Can any of the company-specific risk be diversified away by investing in both Sea Air and Ha Noi 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 Sea Air and Ha Noi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sea Air Freight and Ha Noi Education, you can compare the effects of market volatilities on Sea Air and Ha Noi 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 Sea Air with a short position of Ha Noi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sea Air and Ha Noi.
Diversification Opportunities for Sea Air and Ha Noi
Very weak diversification
The 3 months correlation between Sea and EID is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sea Air Freight and Ha Noi Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ha Noi Education and Sea Air 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 Sea Air Freight are associated (or correlated) with Ha Noi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ha Noi Education has no effect on the direction of Sea Air i.e., Sea Air and Ha Noi go up and down completely randomly.
Pair Corralation between Sea Air and Ha Noi
Assuming the 90 days trading horizon Sea Air Freight is expected to under-perform the Ha Noi. In addition to that, Sea Air is 2.94 times more volatile than Ha Noi Education. It trades about -0.04 of its total potential returns per unit of risk. Ha Noi Education is currently generating about 0.01 per unit of volatility. If you would invest 2,690,000 in Ha Noi Education on August 31, 2024 and sell it today you would earn a total of 10,000 from holding Ha Noi Education or generate 0.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.23% |
| Values | Daily Returns |
Sea Air Freight vs. Ha Noi Education
Performance |
| Timeline |
| Sea Air Freight |
| Ha Noi Education |
Sea Air and Ha Noi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sea Air and Ha Noi
The main advantage of trading using opposite Sea Air and Ha Noi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sea Air position performs unexpectedly, Ha Noi 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 Ha Noi will offset losses from the drop in Ha Noi's long position.| Sea Air vs. Saigon Beer Alcohol | Sea Air vs. SCG Construction JSC | Sea Air vs. Hung Hau Agricultural | Sea Air vs. Vietnam Petroleum Transport |
| Ha Noi vs. Development Investment Construction | Ha Noi vs. 1369 Construction JSC | Ha Noi vs. Saigon Telecommunication Technologies | Ha Noi 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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