Correlation Between Thong Nhat and Tay Ninh
Can any of the company-specific risk be diversified away by investing in both Thong Nhat and Tay Ninh 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 Thong Nhat and Tay Ninh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thong Nhat Rubber and Tay Ninh Rubber, you can compare the effects of market volatilities on Thong Nhat and Tay Ninh 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 Thong Nhat with a short position of Tay Ninh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thong Nhat and Tay Ninh.
Diversification Opportunities for Thong Nhat and Tay Ninh
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Thong and Tay is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Thong Nhat Rubber and Tay Ninh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tay Ninh Rubber and Thong Nhat 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 Thong Nhat Rubber are associated (or correlated) with Tay Ninh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tay Ninh Rubber has no effect on the direction of Thong Nhat i.e., Thong Nhat and Tay Ninh go up and down completely randomly.
Pair Corralation between Thong Nhat and Tay Ninh
Assuming the 90 days trading horizon Thong Nhat is expected to generate 10.24 times less return on investment than Tay Ninh. In addition to that, Thong Nhat is 1.94 times more volatile than Tay Ninh Rubber. It trades about 0.02 of its total potential returns per unit of risk. Tay Ninh Rubber is currently generating about 0.37 per unit of volatility. If you would invest 4,880,000 in Tay Ninh Rubber on October 30, 2024 and sell it today you would earn a total of 2,150,000 from holding Tay Ninh Rubber or generate 44.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 63.41% |
| Values | Daily Returns |
Thong Nhat Rubber vs. Tay Ninh Rubber
Performance |
| Timeline |
| Thong Nhat Rubber |
| Tay Ninh Rubber |
Thong Nhat and Tay Ninh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thong Nhat and Tay Ninh
The main advantage of trading using opposite Thong Nhat and Tay Ninh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thong Nhat position performs unexpectedly, Tay Ninh 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 Tay Ninh will offset losses from the drop in Tay Ninh's long position.| Thong Nhat vs. Vietnam Dairy Products | Thong Nhat vs. Southern Rubber Industry | Thong Nhat vs. Petrolimex Information Technology | Thong Nhat vs. Hanoi Plastics JSC |
| Tay Ninh vs. Truong Thanh Furniture | Tay Ninh vs. Nam Kim Steel | Tay Ninh vs. Vinhomes JSC | Tay Ninh vs. Post and Telecommunications |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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