Correlation Between Tay Ninh and Thong Nhat
Can any of the company-specific risk be diversified away by investing in both Tay Ninh and Thong Nhat 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 Thong Nhat 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 Thong Nhat Rubber, you can compare the effects of market volatilities on Tay Ninh and Thong Nhat 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 Thong Nhat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tay Ninh and Thong Nhat.
Diversification Opportunities for Tay Ninh and Thong Nhat
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tay and Thong is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Tay Ninh Rubber and Thong Nhat Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thong Nhat Rubber 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 Thong Nhat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thong Nhat Rubber has no effect on the direction of Tay Ninh i.e., Tay Ninh and Thong Nhat go up and down completely randomly.
Pair Corralation between Tay Ninh and Thong Nhat
Assuming the 90 days trading horizon Tay Ninh Rubber is expected to generate 0.52 times more return on investment than Thong Nhat. However, Tay Ninh Rubber is 1.94 times less risky than Thong Nhat. It trades about 0.37 of its potential returns per unit of risk. Thong Nhat Rubber is currently generating about 0.02 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 Against |
| Strength | Weak |
| Accuracy | 63.41% |
| Values | Daily Returns |
Tay Ninh Rubber vs. Thong Nhat Rubber
Performance |
| Timeline |
| Tay Ninh Rubber |
| Thong Nhat Rubber |
Tay Ninh and Thong Nhat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tay Ninh and Thong Nhat
The main advantage of trading using opposite Tay Ninh and Thong Nhat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tay Ninh position performs unexpectedly, Thong Nhat 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 Thong Nhat will offset losses from the drop in Thong Nhat'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 |
| Thong Nhat vs. Vietnam Dairy Products | Thong Nhat vs. Southern Rubber Industry | Thong Nhat vs. Petrolimex Information Technology | Thong Nhat 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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