Correlation Between Thong Nhat and Truong Thanh
Can any of the company-specific risk be diversified away by investing in both Thong Nhat and Truong Thanh 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 Truong Thanh 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 Truong Thanh Furniture, you can compare the effects of market volatilities on Thong Nhat and Truong Thanh 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 Truong Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thong Nhat and Truong Thanh.
Diversification Opportunities for Thong Nhat and Truong Thanh
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thong and Truong is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Thong Nhat Rubber and Truong Thanh Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Truong Thanh Furniture 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 Truong Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Truong Thanh Furniture has no effect on the direction of Thong Nhat i.e., Thong Nhat and Truong Thanh go up and down completely randomly.
Pair Corralation between Thong Nhat and Truong Thanh
Assuming the 90 days trading horizon Thong Nhat Rubber is expected to under-perform the Truong Thanh. In addition to that, Thong Nhat is 2.64 times more volatile than Truong Thanh Furniture. It trades about -0.09 of its total potential returns per unit of risk. Truong Thanh Furniture is currently generating about 0.01 per unit of volatility. If you would invest 309,000 in Truong Thanh Furniture on October 12, 2024 and sell it today you would earn a total of 0.00 from holding Truong Thanh Furniture or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 76.19% |
| Values | Daily Returns |
Thong Nhat Rubber vs. Truong Thanh Furniture
Performance |
| Timeline |
| Thong Nhat Rubber |
| Truong Thanh Furniture |
Thong Nhat and Truong Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thong Nhat and Truong Thanh
The main advantage of trading using opposite Thong Nhat and Truong Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thong Nhat position performs unexpectedly, Truong Thanh 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 Truong Thanh will offset losses from the drop in Truong Thanh's long position.| Thong Nhat vs. FIT INVEST JSC | Thong Nhat vs. Damsan JSC | Thong Nhat vs. An Phat Plastic | Thong Nhat vs. APG Securities Joint |
| Truong Thanh vs. Thong Nhat Rubber | Truong Thanh vs. VTC Telecommunications JSC | Truong Thanh vs. Viet Thanh Plastic | Truong Thanh vs. Dong A Hotel |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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