Correlation Between Vnsteel Vicasa and Viet Thanh
Can any of the company-specific risk be diversified away by investing in both Vnsteel Vicasa and Viet 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 Vnsteel Vicasa and Viet Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vnsteel Vicasa JSC and Viet Thanh Plastic, you can compare the effects of market volatilities on Vnsteel Vicasa and Viet 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 Vnsteel Vicasa with a short position of Viet Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vnsteel Vicasa and Viet Thanh.
Diversification Opportunities for Vnsteel Vicasa and Viet Thanh
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vnsteel and Viet is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Vnsteel Vicasa JSC and Viet Thanh Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viet Thanh Plastic and Vnsteel Vicasa 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 Vnsteel Vicasa JSC are associated (or correlated) with Viet Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viet Thanh Plastic has no effect on the direction of Vnsteel Vicasa i.e., Vnsteel Vicasa and Viet Thanh go up and down completely randomly.
Pair Corralation between Vnsteel Vicasa and Viet Thanh
Assuming the 90 days trading horizon Vnsteel Vicasa is expected to generate 3.49 times less return on investment than Viet Thanh. In addition to that, Vnsteel Vicasa is 1.04 times more volatile than Viet Thanh Plastic. It trades about 0.02 of its total potential returns per unit of risk. Viet Thanh Plastic is currently generating about 0.07 per unit of volatility. If you would invest 820,000 in Viet Thanh Plastic on October 30, 2024 and sell it today you would earn a total of 920,000 from holding Viet Thanh Plastic or generate 112.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 88.82% |
| Values | Daily Returns |
Vnsteel Vicasa JSC vs. Viet Thanh Plastic
Performance |
| Timeline |
| Vnsteel Vicasa JSC |
| Viet Thanh Plastic |
Vnsteel Vicasa and Viet Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vnsteel Vicasa and Viet Thanh
The main advantage of trading using opposite Vnsteel Vicasa and Viet Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vnsteel Vicasa position performs unexpectedly, Viet 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 Viet Thanh will offset losses from the drop in Viet Thanh's long position.| Vnsteel Vicasa vs. Mobile World Investment | Vnsteel Vicasa vs. Innovative Technology Development | Vnsteel Vicasa vs. PostTelecommunication Equipment | Vnsteel Vicasa vs. Tin Nghia Industrial |
| Viet Thanh vs. Ben Thanh Rubber | Viet Thanh vs. Thong Nhat Rubber | Viet Thanh vs. Construction And Investment | Viet Thanh vs. Petrolimex International Trading |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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