Correlation Between Truong Thanh and Tien Giang
Can any of the company-specific risk be diversified away by investing in both Truong Thanh and Tien Giang 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 Tien Giang 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 Tien Giang Investment, you can compare the effects of market volatilities on Truong Thanh and Tien Giang 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 Tien Giang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truong Thanh and Tien Giang.
Diversification Opportunities for Truong Thanh and Tien Giang
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Truong and Tien is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Truong Thanh Furniture and Tien Giang Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tien Giang 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 Tien Giang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tien Giang Investment has no effect on the direction of Truong Thanh i.e., Truong Thanh and Tien Giang go up and down completely randomly.
Pair Corralation between Truong Thanh and Tien Giang
Assuming the 90 days trading horizon Truong Thanh Furniture is expected to under-perform the Tien Giang. But the stock apears to be less risky and, when comparing its historical volatility, Truong Thanh Furniture is 2.05 times less risky than Tien Giang. The stock trades about -0.32 of its potential returns per unit of risk. The Tien Giang Investment is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 4,980,000 in Tien Giang Investment on November 7, 2024 and sell it today you would earn a total of 470,000 from holding Tien Giang Investment or generate 9.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truong Thanh Furniture vs. Tien Giang Investment
Performance |
| Timeline |
| Truong Thanh Furniture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Tien Giang Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Truong Thanh and Tien Giang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truong Thanh and Tien Giang
The main advantage of trading using opposite Truong Thanh and Tien Giang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truong Thanh position performs unexpectedly, Tien Giang 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 Tien Giang will offset losses from the drop in Tien Giang's long position.| Truong Thanh vs. Elcom Technology Communications | Truong Thanh vs. Transport and Industry | Truong Thanh vs. Hai An Transport | Truong Thanh vs. HUD1 Investment and |
| Tien Giang vs. Transport and Industry | Tien Giang vs. Vietnam Technological And | Tien Giang vs. Innovative Technology Development | Tien Giang vs. Elcom Technology Communications |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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