Correlation Between Truong Thanh and Din Capital
Can any of the company-specific risk be diversified away by investing in both Truong Thanh and Din Capital 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 Truong Thanh and Din Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truong Thanh Furniture and Din Capital Investment, you can compare the effects of market volatilities on Truong Thanh and Din Capital 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 Truong Thanh with a short position of Din Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truong Thanh and Din Capital.
Diversification Opportunities for Truong Thanh and Din Capital
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Truong and Din is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Truong Thanh Furniture and Din Capital Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Din Capital Investment and Truong Thanh 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 Truong Thanh Furniture are associated (or correlated) with Din Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Din Capital Investment has no effect on the direction of Truong Thanh i.e., Truong Thanh and Din Capital go up and down completely randomly.
Pair Corralation between Truong Thanh and Din Capital
Assuming the 90 days trading horizon Truong Thanh Furniture is expected to generate 0.7 times more return on investment than Din Capital. However, Truong Thanh Furniture is 1.42 times less risky than Din Capital. It trades about -0.06 of its potential returns per unit of risk. Din Capital Investment is currently generating about -0.05 per unit of risk. If you would invest 312,000 in Truong Thanh Furniture on September 15, 2024 and sell it today you would lose (5,000) from holding Truong Thanh Furniture or give up 1.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truong Thanh Furniture vs. Din Capital Investment
Performance |
| Timeline |
| Truong Thanh Furniture |
| Din Capital Investment |
Truong Thanh and Din Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truong Thanh and Din Capital
The main advantage of trading using opposite Truong Thanh and Din Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truong Thanh position performs unexpectedly, Din Capital 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 Din Capital will offset losses from the drop in Din Capital's long position.| Truong Thanh vs. FIT INVEST JSC | Truong Thanh vs. Damsan JSC | Truong Thanh vs. An Phat Plastic | Truong Thanh vs. Alphanam ME |
| Din Capital vs. DIC Holdings Construction | Din Capital vs. Hochiminh City Metal | Din Capital vs. Binh Duong Trade | Din Capital vs. Kien Giang Construction |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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