Correlation Between TNS Holdings and VTC Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both TNS Holdings and VTC Telecommunicatio 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 TNS Holdings and VTC Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TNS Holdings JSC and VTC Telecommunications JSC, you can compare the effects of market volatilities on TNS Holdings and VTC Telecommunicatio 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 TNS Holdings with a short position of VTC Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of TNS Holdings and VTC Telecommunicatio.
Diversification Opportunities for TNS Holdings and VTC Telecommunicatio
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TNS and VTC is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding TNS Holdings JSC and VTC Telecommunications JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VTC Telecommunications and TNS Holdings 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 TNS Holdings JSC are associated (or correlated) with VTC Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VTC Telecommunications has no effect on the direction of TNS Holdings i.e., TNS Holdings and VTC Telecommunicatio go up and down completely randomly.
Pair Corralation between TNS Holdings and VTC Telecommunicatio
Assuming the 90 days trading horizon TNS Holdings JSC is expected to generate 22.29 times more return on investment than VTC Telecommunicatio. However, TNS Holdings is 22.29 times more volatile than VTC Telecommunications JSC. It trades about 0.1 of its potential returns per unit of risk. VTC Telecommunications JSC is currently generating about 0.02 per unit of risk. If you would invest 1,321,045 in TNS Holdings JSC on September 4, 2024 and sell it today you would lose (261,045) from holding TNS Holdings JSC or give up 19.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 71.52% |
| Values | Daily Returns |
TNS Holdings JSC vs. VTC Telecommunications JSC
Performance |
| Timeline |
| TNS Holdings JSC |
| VTC Telecommunications |
TNS Holdings and VTC Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TNS Holdings and VTC Telecommunicatio
The main advantage of trading using opposite TNS Holdings and VTC Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TNS Holdings position performs unexpectedly, VTC Telecommunicatio 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 VTC Telecommunicatio will offset losses from the drop in VTC Telecommunicatio's long position.| TNS Holdings vs. VTC Telecommunications JSC | TNS Holdings vs. VietinBank Securities JSC | TNS Holdings vs. Dong A Hotel | TNS Holdings vs. Hanoi Beer Alcohol |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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