Correlation Between Tin Nghia and Phuoc Hoa
Can any of the company-specific risk be diversified away by investing in both Tin Nghia and Phuoc Hoa 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 Tin Nghia and Phuoc Hoa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tin Nghia Industrial and Phuoc Hoa Rubber, you can compare the effects of market volatilities on Tin Nghia and Phuoc Hoa 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 Tin Nghia with a short position of Phuoc Hoa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tin Nghia and Phuoc Hoa.
Diversification Opportunities for Tin Nghia and Phuoc Hoa
Poor diversification
The 3 months correlation between Tin and Phuoc is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Tin Nghia Industrial and Phuoc Hoa Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phuoc Hoa Rubber and Tin Nghia 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 Tin Nghia Industrial are associated (or correlated) with Phuoc Hoa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phuoc Hoa Rubber has no effect on the direction of Tin Nghia i.e., Tin Nghia and Phuoc Hoa go up and down completely randomly.
Pair Corralation between Tin Nghia and Phuoc Hoa
Assuming the 90 days trading horizon Tin Nghia Industrial is expected to under-perform the Phuoc Hoa. In addition to that, Tin Nghia is 1.12 times more volatile than Phuoc Hoa Rubber. It trades about -0.06 of its total potential returns per unit of risk. Phuoc Hoa Rubber is currently generating about 0.12 per unit of volatility. If you would invest 5,500,000 in Phuoc Hoa Rubber on August 27, 2024 and sell it today you would earn a total of 200,000 from holding Phuoc Hoa Rubber or generate 3.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tin Nghia Industrial vs. Phuoc Hoa Rubber
Performance |
| Timeline |
| Tin Nghia Industrial |
| Phuoc Hoa Rubber |
Tin Nghia and Phuoc Hoa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tin Nghia and Phuoc Hoa
The main advantage of trading using opposite Tin Nghia and Phuoc Hoa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tin Nghia position performs unexpectedly, Phuoc Hoa 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 Phuoc Hoa will offset losses from the drop in Phuoc Hoa's long position.| Tin Nghia vs. FIT INVEST JSC | Tin Nghia vs. Damsan JSC | Tin Nghia vs. An Phat Plastic | Tin Nghia vs. APG Securities Joint |
| Phuoc Hoa vs. FIT INVEST JSC | Phuoc Hoa vs. Damsan JSC | Phuoc Hoa vs. An Phat Plastic | Phuoc Hoa 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |