Correlation Between Tien Giang and Ben Thanh
Can any of the company-specific risk be diversified away by investing in both Tien Giang and Ben Thanh 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 Tien Giang and Ben Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tien Giang Investment and Ben Thanh Rubber, you can compare the effects of market volatilities on Tien Giang and Ben Thanh 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 Tien Giang with a short position of Ben Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tien Giang and Ben Thanh.
Diversification Opportunities for Tien Giang and Ben Thanh
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tien and Ben is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Tien Giang Investment and Ben Thanh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ben Thanh Rubber and Tien Giang 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 Tien Giang Investment are associated (or correlated) with Ben Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ben Thanh Rubber has no effect on the direction of Tien Giang i.e., Tien Giang and Ben Thanh go up and down completely randomly.
Pair Corralation between Tien Giang and Ben Thanh
Assuming the 90 days trading horizon Tien Giang Investment is expected to generate 1.11 times more return on investment than Ben Thanh. However, Tien Giang is 1.11 times more volatile than Ben Thanh Rubber. It trades about 0.09 of its potential returns per unit of risk. Ben Thanh Rubber is currently generating about 0.09 per unit of risk. If you would invest 4,390,000 in Tien Giang Investment on September 12, 2024 and sell it today you would earn a total of 70,000 from holding Tien Giang Investment or generate 1.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tien Giang Investment vs. Ben Thanh Rubber
Performance |
| Timeline |
| Tien Giang Investment |
| Ben Thanh Rubber |
Tien Giang and Ben Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tien Giang and Ben Thanh
The main advantage of trading using opposite Tien Giang and Ben Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tien Giang position performs unexpectedly, Ben Thanh 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 Ben Thanh will offset losses from the drop in Ben Thanh's long position.| Tien Giang vs. FIT INVEST JSC | Tien Giang vs. Damsan JSC | Tien Giang vs. An Phat Plastic | Tien Giang vs. Alphanam ME |
| Ben Thanh vs. FIT INVEST JSC | Ben Thanh vs. Damsan JSC | Ben Thanh vs. An Phat Plastic | Ben Thanh vs. Alphanam ME |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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