Correlation Between Saigon Telecommunicatio and Construction JSC
Can any of the company-specific risk be diversified away by investing in both Saigon Telecommunicatio and Construction JSC 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 Construction JSC 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 Construction JSC No5, you can compare the effects of market volatilities on Saigon Telecommunicatio and Construction JSC 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 Construction JSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saigon Telecommunicatio and Construction JSC.
Diversification Opportunities for Saigon Telecommunicatio and Construction JSC
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Saigon and Construction is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Saigon Telecommunication Techn and Construction JSC No5 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Construction JSC No5 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 Construction JSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Construction JSC No5 has no effect on the direction of Saigon Telecommunicatio i.e., Saigon Telecommunicatio and Construction JSC go up and down completely randomly.
Pair Corralation between Saigon Telecommunicatio and Construction JSC
Assuming the 90 days trading horizon Saigon Telecommunication Technologies is expected to generate 0.59 times more return on investment than Construction JSC. However, Saigon Telecommunication Technologies is 1.69 times less risky than Construction JSC. It trades about 0.09 of its potential returns per unit of risk. Construction JSC No5 is currently generating about 0.02 per unit of risk. If you would invest 1,210,000 in Saigon Telecommunication Technologies on November 5, 2024 and sell it today you would earn a total of 775,000 from holding Saigon Telecommunication Technologies or generate 64.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 56.54% |
| Values | Daily Returns |
Saigon Telecommunication Techn vs. Construction JSC No5
Performance |
| Timeline |
| Saigon Telecommunicatio |
| Construction JSC No5 |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Saigon Telecommunicatio and Construction JSC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saigon Telecommunicatio and Construction JSC
The main advantage of trading using opposite Saigon Telecommunicatio and Construction JSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saigon Telecommunicatio position performs unexpectedly, Construction JSC 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 Construction JSC will offset losses from the drop in Construction JSC's long position.| Saigon Telecommunicatio vs. BIDV Insurance Corp | Saigon Telecommunicatio vs. Song Hong Aluminum | Saigon Telecommunicatio vs. Saigon Beer Alcohol | Saigon Telecommunicatio vs. Ha Noi Education |
| Construction JSC vs. Thanh Dat Investment | Construction JSC vs. MST Investment JSC | Construction JSC vs. Vina2 Investment and | Construction JSC vs. Techno Agricultural Supplying |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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