Correlation Between Saigon Telecommunicatio and Pha Le
Can any of the company-specific risk be diversified away by investing in both Saigon Telecommunicatio and Pha Le 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 Telecommunicatio and Pha Le into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saigon Telecommunication Technologies and Pha Le Plastics, you can compare the effects of market volatilities on Saigon Telecommunicatio and Pha Le 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 Telecommunicatio with a short position of Pha Le. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saigon Telecommunicatio and Pha Le.
Diversification Opportunities for Saigon Telecommunicatio and Pha Le
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saigon and Pha is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Saigon Telecommunication Techn and Pha Le Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Le Plastics and Saigon Telecommunicatio 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 Telecommunication Technologies are associated (or correlated) with Pha Le. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Le Plastics has no effect on the direction of Saigon Telecommunicatio i.e., Saigon Telecommunicatio and Pha Le go up and down completely randomly.
Pair Corralation between Saigon Telecommunicatio and Pha Le
Assuming the 90 days trading horizon Saigon Telecommunication Technologies is expected to generate 1.09 times more return on investment than Pha Le. However, Saigon Telecommunicatio is 1.09 times more volatile than Pha Le Plastics. It trades about -0.04 of its potential returns per unit of risk. Pha Le Plastics is currently generating about -0.1 per unit of risk. If you would invest 1,500,000 in Saigon Telecommunication Technologies on August 27, 2024 and sell it today you would lose (30,000) from holding Saigon Telecommunication Technologies or give up 2.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saigon Telecommunication Techn vs. Pha Le Plastics
Performance |
| Timeline |
| Saigon Telecommunicatio |
| Pha Le Plastics |
Saigon Telecommunicatio and Pha Le Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saigon Telecommunicatio and Pha Le
The main advantage of trading using opposite Saigon Telecommunicatio and Pha Le positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saigon Telecommunicatio position performs unexpectedly, Pha Le 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 Pha Le will offset losses from the drop in Pha Le's long position.| Saigon Telecommunicatio vs. FIT INVEST JSC | Saigon Telecommunicatio vs. Damsan JSC | Saigon Telecommunicatio vs. An Phat Plastic | Saigon Telecommunicatio vs. APG Securities Joint |
| Pha Le vs. FIT INVEST JSC | Pha Le vs. Damsan JSC | Pha Le vs. An Phat Plastic | Pha Le 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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