Correlation Between Techno Agricultural and Hanoi Plastics
Can any of the company-specific risk be diversified away by investing in both Techno Agricultural and Hanoi Plastics 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 Techno Agricultural and Hanoi Plastics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Techno Agricultural Supplying and Hanoi Plastics JSC, you can compare the effects of market volatilities on Techno Agricultural and Hanoi Plastics 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 Techno Agricultural with a short position of Hanoi Plastics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techno Agricultural and Hanoi Plastics.
Diversification Opportunities for Techno Agricultural and Hanoi Plastics
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Techno and Hanoi is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Techno Agricultural Supplying and Hanoi Plastics JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanoi Plastics JSC and Techno Agricultural 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 Techno Agricultural Supplying are associated (or correlated) with Hanoi Plastics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanoi Plastics JSC has no effect on the direction of Techno Agricultural i.e., Techno Agricultural and Hanoi Plastics go up and down completely randomly.
Pair Corralation between Techno Agricultural and Hanoi Plastics
Assuming the 90 days trading horizon Techno Agricultural Supplying is expected to generate 1.02 times more return on investment than Hanoi Plastics. However, Techno Agricultural is 1.02 times more volatile than Hanoi Plastics JSC. It trades about 0.08 of its potential returns per unit of risk. Hanoi Plastics JSC is currently generating about -0.06 per unit of risk. If you would invest 239,000 in Techno Agricultural Supplying on November 7, 2024 and sell it today you would earn a total of 3,000 from holding Techno Agricultural Supplying or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Techno Agricultural Supplying vs. Hanoi Plastics JSC
Performance |
| Timeline |
| Techno Agricultural |
| Hanoi Plastics JSC |
Techno Agricultural and Hanoi Plastics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Techno Agricultural and Hanoi Plastics
The main advantage of trading using opposite Techno Agricultural and Hanoi Plastics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techno Agricultural position performs unexpectedly, Hanoi Plastics 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 Hanoi Plastics will offset losses from the drop in Hanoi Plastics' long position.| Techno Agricultural vs. FIT INVEST JSC | Techno Agricultural vs. Damsan JSC | Techno Agricultural vs. An Phat Plastic | Techno Agricultural vs. APG Securities Joint |
| Hanoi Plastics vs. Transport and Industry | Hanoi Plastics vs. Binhthuan Agriculture Services | Hanoi Plastics vs. Vietnam JSCmmercial Bank | Hanoi Plastics vs. Innovative Technology Development |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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