Correlation Between Tien Giang and Ba Ria
Can any of the company-specific risk be diversified away by investing in both Tien Giang and Ba Ria 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 Ba Ria 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 Ba Ria Thermal, you can compare the effects of market volatilities on Tien Giang and Ba Ria 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 Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tien Giang and Ba Ria.
Diversification Opportunities for Tien Giang and Ba Ria
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tien and BTP is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Tien Giang Investment and Ba Ria Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ba Ria Thermal 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 Ba Ria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ba Ria Thermal has no effect on the direction of Tien Giang i.e., Tien Giang and Ba Ria go up and down completely randomly.
Pair Corralation between Tien Giang and Ba Ria
Assuming the 90 days trading horizon Tien Giang Investment is expected to generate 0.93 times more return on investment than Ba Ria. However, Tien Giang Investment is 1.07 times less risky than Ba Ria. It trades about 0.07 of its potential returns per unit of risk. Ba Ria Thermal is currently generating about 0.02 per unit of risk. If you would invest 2,794,006 in Tien Giang Investment on August 28, 2024 and sell it today you would earn a total of 1,585,994 from holding Tien Giang Investment or generate 56.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
Tien Giang Investment vs. Ba Ria Thermal
Performance |
| Timeline |
| Tien Giang Investment |
| Ba Ria Thermal |
Tien Giang and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tien Giang and Ba Ria
The main advantage of trading using opposite Tien Giang and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tien Giang position performs unexpectedly, Ba Ria 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 Ba Ria will offset losses from the drop in Ba Ria's long position.| Tien Giang vs. Danang Rubber JSC | Tien Giang vs. Phuoc Hoa Rubber | Tien Giang vs. Southern Rubber Industry | Tien Giang vs. Tay Ninh Rubber |
| Ba Ria vs. FIT INVEST JSC | Ba Ria vs. Damsan JSC | Ba Ria vs. An Phat Plastic | Ba Ria 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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