Correlation Between Saigon Telecommunicatio and Binh Duong
Can any of the company-specific risk be diversified away by investing in both Saigon Telecommunicatio and Binh Duong 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 Binh Duong 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 Binh Duong Trade, you can compare the effects of market volatilities on Saigon Telecommunicatio and Binh Duong 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 Binh Duong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saigon Telecommunicatio and Binh Duong.
Diversification Opportunities for Saigon Telecommunicatio and Binh Duong
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Saigon and Binh is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Saigon Telecommunication Techn and Binh Duong Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Duong Trade 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 Binh Duong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binh Duong Trade has no effect on the direction of Saigon Telecommunicatio i.e., Saigon Telecommunicatio and Binh Duong go up and down completely randomly.
Pair Corralation between Saigon Telecommunicatio and Binh Duong
Assuming the 90 days trading horizon Saigon Telecommunication Technologies is expected to generate 0.72 times more return on investment than Binh Duong. However, Saigon Telecommunication Technologies is 1.39 times less risky than Binh Duong. It trades about 0.26 of its potential returns per unit of risk. Binh Duong Trade is currently generating about 0.13 per unit of risk. If you would invest 1,725,000 in Saigon Telecommunication Technologies on December 1, 2024 and sell it today you would earn a total of 305,000 from holding Saigon Telecommunication Technologies or generate 17.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saigon Telecommunication Techn vs. Binh Duong Trade
Performance |
| Timeline |
| Saigon Telecommunicatio |
| Binh Duong Trade |
Saigon Telecommunicatio and Binh Duong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saigon Telecommunicatio and Binh Duong
The main advantage of trading using opposite Saigon Telecommunicatio and Binh Duong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saigon Telecommunicatio position performs unexpectedly, Binh Duong 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 Binh Duong will offset losses from the drop in Binh Duong's long position.| Saigon Telecommunicatio vs. Ben Thanh Rubber | Saigon Telecommunicatio vs. PVI Reinsurance Corp | Saigon Telecommunicatio vs. Saigon Beer Alcohol | Saigon Telecommunicatio vs. Hanoi Plastics JSC |
| Binh Duong vs. Ha Long Investment | Binh Duong vs. Military Insurance Corp | Binh Duong vs. Nam Kim Steel | Binh Duong vs. Dinhvu Port Investment |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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