Correlation Between Vina2 Investment and Ben Thanh
Can any of the company-specific risk be diversified away by investing in both Vina2 Investment and Ben Thanh 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 Vina2 Investment and Ben Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vina2 Investment and and Ben Thanh Rubber, you can compare the effects of market volatilities on Vina2 Investment and Ben Thanh 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 Vina2 Investment with a short position of Ben Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vina2 Investment and Ben Thanh.
Diversification Opportunities for Vina2 Investment and Ben Thanh
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vina2 and Ben is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Vina2 Investment and and Ben Thanh Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ben Thanh Rubber and Vina2 Investment 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 Vina2 Investment and are associated (or correlated) with Ben Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ben Thanh Rubber has no effect on the direction of Vina2 Investment i.e., Vina2 Investment and Ben Thanh go up and down completely randomly.
Pair Corralation between Vina2 Investment and Ben Thanh
Assuming the 90 days trading horizon Vina2 Investment and is expected to generate 4.19 times more return on investment than Ben Thanh. However, Vina2 Investment is 4.19 times more volatile than Ben Thanh Rubber. It trades about 0.12 of its potential returns per unit of risk. Ben Thanh Rubber is currently generating about 0.09 per unit of risk. If you would invest 910,000 in Vina2 Investment and on September 12, 2024 and sell it today you would earn a total of 70,000 from holding Vina2 Investment and or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Vina2 Investment and vs. Ben Thanh Rubber
Performance |
| Timeline |
| Vina2 Investment |
| Ben Thanh Rubber |
Vina2 Investment and Ben Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vina2 Investment and Ben Thanh
The main advantage of trading using opposite Vina2 Investment and Ben Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vina2 Investment position performs unexpectedly, Ben Thanh 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 Ben Thanh will offset losses from the drop in Ben Thanh's long position.| Vina2 Investment vs. FIT INVEST JSC | Vina2 Investment vs. Damsan JSC | Vina2 Investment vs. An Phat Plastic | Vina2 Investment vs. Alphanam ME |
| Ben Thanh vs. FIT INVEST JSC | Ben Thanh vs. Damsan JSC | Ben Thanh vs. An Phat Plastic | Ben Thanh vs. Alphanam ME |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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