Correlation Between Century Synthetic and Vinhomes JSC
Can any of the company-specific risk be diversified away by investing in both Century Synthetic and Vinhomes 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 Century Synthetic and Vinhomes JSC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Synthetic Fiber and Vinhomes JSC, you can compare the effects of market volatilities on Century Synthetic and Vinhomes 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 Century Synthetic with a short position of Vinhomes JSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Synthetic and Vinhomes JSC.
Diversification Opportunities for Century Synthetic and Vinhomes JSC
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Century and Vinhomes is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Century Synthetic Fiber and Vinhomes JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vinhomes JSC and Century Synthetic 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 Century Synthetic Fiber are associated (or correlated) with Vinhomes JSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vinhomes JSC has no effect on the direction of Century Synthetic i.e., Century Synthetic and Vinhomes JSC go up and down completely randomly.
Pair Corralation between Century Synthetic and Vinhomes JSC
Assuming the 90 days trading horizon Century Synthetic Fiber is expected to under-perform the Vinhomes JSC. In addition to that, Century Synthetic is 1.17 times more volatile than Vinhomes JSC. It trades about -0.06 of its total potential returns per unit of risk. Vinhomes JSC is currently generating about 0.02 per unit of volatility. If you would invest 3,930,000 in Vinhomes JSC on September 3, 2024 and sell it today you would earn a total of 145,000 from holding Vinhomes JSC or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Century Synthetic Fiber vs. Vinhomes JSC
Performance |
| Timeline |
| Century Synthetic Fiber |
| Vinhomes JSC |
Century Synthetic and Vinhomes JSC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Synthetic and Vinhomes JSC
The main advantage of trading using opposite Century Synthetic and Vinhomes JSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Synthetic position performs unexpectedly, Vinhomes 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 Vinhomes JSC will offset losses from the drop in Vinhomes JSC's long position.| Century Synthetic vs. FIT INVEST JSC | Century Synthetic vs. Damsan JSC | Century Synthetic vs. An Phat Plastic | Century Synthetic vs. Alphanam ME |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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