Correlation Between Tay Ninh and Vu Dang
Can any of the company-specific risk be diversified away by investing in both Tay Ninh and Vu Dang 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 Tay Ninh and Vu Dang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tay Ninh Rubber and Vu Dang Investment, you can compare the effects of market volatilities on Tay Ninh and Vu Dang 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 Tay Ninh with a short position of Vu Dang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tay Ninh and Vu Dang.
Diversification Opportunities for Tay Ninh and Vu Dang
Average diversification
The 3 months correlation between Tay and SVD is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Tay Ninh Rubber and Vu Dang Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vu Dang Investment and Tay Ninh 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 Tay Ninh Rubber are associated (or correlated) with Vu Dang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vu Dang Investment has no effect on the direction of Tay Ninh i.e., Tay Ninh and Vu Dang go up and down completely randomly.
Pair Corralation between Tay Ninh and Vu Dang
Assuming the 90 days trading horizon Tay Ninh Rubber is expected to generate 0.99 times more return on investment than Vu Dang. However, Tay Ninh Rubber is 1.01 times less risky than Vu Dang. It trades about 0.37 of its potential returns per unit of risk. Vu Dang Investment is currently generating about -0.01 per unit of risk. 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 Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tay Ninh Rubber vs. Vu Dang Investment
Performance |
| Timeline |
| Tay Ninh Rubber |
| Vu Dang Investment |
Tay Ninh and Vu Dang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tay Ninh and Vu Dang
The main advantage of trading using opposite Tay Ninh and Vu Dang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tay Ninh position performs unexpectedly, Vu Dang 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 Vu Dang will offset losses from the drop in Vu Dang's long position.| Tay Ninh vs. Truong Thanh Furniture | Tay Ninh vs. Nam Kim Steel | Tay Ninh vs. Vinhomes JSC | Tay Ninh vs. Post and Telecommunications |
| Vu Dang vs. VTC Telecommunications JSC | Vu Dang vs. Transimex Transportation JSC | Vu Dang vs. Ha Noi Education | Vu Dang vs. Danang Education Investment |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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