Correlation Between Sao Vang and Ducgiang Chemicals
Can any of the company-specific risk be diversified away by investing in both Sao Vang and Ducgiang Chemicals 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 Sao Vang and Ducgiang Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sao Vang Rubber and Ducgiang Chemicals Detergent, you can compare the effects of market volatilities on Sao Vang and Ducgiang Chemicals 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 Sao Vang with a short position of Ducgiang Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sao Vang and Ducgiang Chemicals.
Diversification Opportunities for Sao Vang and Ducgiang Chemicals
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sao and Ducgiang is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sao Vang Rubber and Ducgiang Chemicals Detergent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ducgiang Chemicals and Sao Vang 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 Sao Vang Rubber are associated (or correlated) with Ducgiang Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ducgiang Chemicals has no effect on the direction of Sao Vang i.e., Sao Vang and Ducgiang Chemicals go up and down completely randomly.
Pair Corralation between Sao Vang and Ducgiang Chemicals
Assuming the 90 days trading horizon Sao Vang Rubber is expected to under-perform the Ducgiang Chemicals. In addition to that, Sao Vang is 2.06 times more volatile than Ducgiang Chemicals Detergent. It trades about -0.12 of its total potential returns per unit of risk. Ducgiang Chemicals Detergent is currently generating about 0.14 per unit of volatility. If you would invest 10,756,600 in Ducgiang Chemicals Detergent on August 29, 2024 and sell it today you would earn a total of 593,400 from holding Ducgiang Chemicals Detergent or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 63.64% |
| Values | Daily Returns |
Sao Vang Rubber vs. Ducgiang Chemicals Detergent
Performance |
| Timeline |
| Sao Vang Rubber |
| Ducgiang Chemicals |
Sao Vang and Ducgiang Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sao Vang and Ducgiang Chemicals
The main advantage of trading using opposite Sao Vang and Ducgiang Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sao Vang position performs unexpectedly, Ducgiang Chemicals 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 Ducgiang Chemicals will offset losses from the drop in Ducgiang Chemicals' long position.| Sao Vang vs. FIT INVEST JSC | Sao Vang vs. Damsan JSC | Sao Vang vs. An Phat Plastic | Sao Vang vs. APG Securities Joint |
| Ducgiang Chemicals vs. FIT INVEST JSC | Ducgiang Chemicals vs. Damsan JSC | Ducgiang Chemicals vs. An Phat Plastic | Ducgiang Chemicals 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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