Correlation Between Binh Duong and Vincom Retail
Can any of the company-specific risk be diversified away by investing in both Binh Duong 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 Binh Duong and Vincom Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binh Duong Trade and Vincom Retail JSC, you can compare the effects of market volatilities on Binh Duong 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 Binh Duong with a short position of Vincom Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binh Duong and Vincom Retail.
Diversification Opportunities for Binh Duong and Vincom Retail
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Binh and Vincom is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Binh Duong Trade 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 Binh Duong 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 Binh Duong Trade 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 Binh Duong i.e., Binh Duong and Vincom Retail go up and down completely randomly.
Pair Corralation between Binh Duong and Vincom Retail
Assuming the 90 days trading horizon Binh Duong Trade is expected to generate 1.18 times more return on investment than Vincom Retail. However, Binh Duong is 1.18 times more volatile than Vincom Retail JSC. It trades about 0.15 of its potential returns per unit of risk. Vincom Retail JSC is currently generating about 0.05 per unit of risk. If you would invest 994,000 in Binh Duong Trade on August 28, 2024 and sell it today you would earn a total of 31,000 from holding Binh Duong Trade or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binh Duong Trade vs. Vincom Retail JSC
Performance |
| Timeline |
| Binh Duong Trade |
| Vincom Retail JSC |
Binh Duong and Vincom Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binh Duong and Vincom Retail
The main advantage of trading using opposite Binh Duong and Vincom Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binh Duong 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.| Binh Duong vs. FIT INVEST JSC | Binh Duong vs. Damsan JSC | Binh Duong vs. An Phat Plastic | Binh Duong vs. APG Securities Joint |
| Vincom Retail vs. Tien Giang Investment | Vincom Retail vs. Duong Hieu Trading | Vincom Retail vs. Ben Thanh Rubber | Vincom Retail vs. LDG Investment JSC |
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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