Correlation Between Tin Nghia and Binh Duong
Can any of the company-specific risk be diversified away by investing in both Tin Nghia and Binh Duong 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 Binh Duong 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 Binh Duong Trade, you can compare the effects of market volatilities on Tin Nghia and Binh Duong 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 Binh Duong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tin Nghia and Binh Duong.
Diversification Opportunities for Tin Nghia and Binh Duong
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tin and Binh is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Tin Nghia Industrial and Binh Duong Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Duong Trade 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 Binh Duong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binh Duong Trade has no effect on the direction of Tin Nghia i.e., Tin Nghia and Binh Duong go up and down completely randomly.
Pair Corralation between Tin Nghia and Binh Duong
Assuming the 90 days trading horizon Tin Nghia is expected to generate 1.26 times less return on investment than Binh Duong. In addition to that, Tin Nghia is 1.85 times more volatile than Binh Duong Trade. It trades about 0.05 of its total potential returns per unit of risk. Binh Duong Trade is currently generating about 0.13 per unit of volatility. If you would invest 997,000 in Binh Duong Trade on September 3, 2024 and sell it today you would earn a total of 23,000 from holding Binh Duong Trade or generate 2.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tin Nghia Industrial vs. Binh Duong Trade
Performance |
| Timeline |
| Tin Nghia Industrial |
| Binh Duong Trade |
Tin Nghia and Binh Duong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tin Nghia and Binh Duong
The main advantage of trading using opposite Tin Nghia and Binh Duong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tin Nghia position performs unexpectedly, Binh Duong 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 Binh Duong will offset losses from the drop in Binh Duong's long position.| Tin Nghia vs. Binh Duong Trade | Tin Nghia vs. Everland Investment JSC | Tin Nghia vs. MST Investment JSC | Tin Nghia vs. Thanh Dat Investment |
| Binh Duong vs. Development Investment Construction | Binh Duong vs. Ba Ria Thermal | Binh Duong vs. Viet Thanh Plastic | Binh Duong vs. Hanoi Plastics 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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