Correlation Between SMC Investment and Vincom Retail
Can any of the company-specific risk be diversified away by investing in both SMC Investment and Vincom Retail 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 SMC Investment and Vincom Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SMC Investment Trading and Vincom Retail JSC, you can compare the effects of market volatilities on SMC Investment and Vincom Retail 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 SMC Investment with a short position of Vincom Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of SMC Investment and Vincom Retail.
Diversification Opportunities for SMC Investment and Vincom Retail
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SMC and Vincom is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding SMC Investment Trading and Vincom Retail JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vincom Retail JSC and SMC Investment 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 SMC Investment Trading are associated (or correlated) with Vincom Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vincom Retail JSC has no effect on the direction of SMC Investment i.e., SMC Investment and Vincom Retail go up and down completely randomly.
Pair Corralation between SMC Investment and Vincom Retail
Assuming the 90 days trading horizon SMC Investment Trading is expected to under-perform the Vincom Retail. In addition to that, SMC Investment is 2.89 times more volatile than Vincom Retail JSC. It trades about -0.09 of its total potential returns per unit of risk. Vincom Retail JSC is currently generating about -0.11 per unit of volatility. If you would invest 1,705,000 in Vincom Retail JSC on October 24, 2024 and sell it today you would lose (45,000) from holding Vincom Retail JSC or give up 2.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SMC Investment Trading vs. Vincom Retail JSC
Performance |
| Timeline |
| SMC Investment Trading |
| Vincom Retail JSC |
SMC Investment and Vincom Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SMC Investment and Vincom Retail
The main advantage of trading using opposite SMC Investment and Vincom Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SMC Investment position performs unexpectedly, Vincom Retail 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 Vincom Retail will offset losses from the drop in Vincom Retail's long position.| SMC Investment vs. Dinhvu Port Investment | SMC Investment vs. Nam Kim Steel | SMC Investment vs. PC3 Investment JSC | SMC Investment vs. Saigon Viendong Technology |
| Vincom Retail vs. BIDV Insurance Corp | Vincom Retail vs. AgriBank Securities JSC | Vincom Retail vs. Vu Dang Investment | Vincom Retail vs. SMC Investment Trading |
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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