Correlation Between Vietnam Enterprise and JLEN Environmental
Can any of the company-specific risk be diversified away by investing in both Vietnam Enterprise and JLEN Environmental 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 Vietnam Enterprise and JLEN Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam Enterprise Investments and JLEN Environmental Assets, you can compare the effects of market volatilities on Vietnam Enterprise and JLEN Environmental 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 Vietnam Enterprise with a short position of JLEN Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam Enterprise and JLEN Environmental.
Diversification Opportunities for Vietnam Enterprise and JLEN Environmental
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vietnam and JLEN is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Enterprise Investments and JLEN Environmental Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLEN Environmental Assets and Vietnam Enterprise 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 Vietnam Enterprise Investments are associated (or correlated) with JLEN Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLEN Environmental Assets has no effect on the direction of Vietnam Enterprise i.e., Vietnam Enterprise and JLEN Environmental go up and down completely randomly.
Pair Corralation between Vietnam Enterprise and JLEN Environmental
Assuming the 90 days trading horizon Vietnam Enterprise Investments is expected to generate 0.49 times more return on investment than JLEN Environmental. However, Vietnam Enterprise Investments is 2.03 times less risky than JLEN Environmental. It trades about -0.07 of its potential returns per unit of risk. JLEN Environmental Assets is currently generating about -0.33 per unit of risk. If you would invest 60,100 in Vietnam Enterprise Investments on November 7, 2024 and sell it today you would lose (800.00) from holding Vietnam Enterprise Investments or give up 1.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vietnam Enterprise Investments vs. JLEN Environmental Assets
Performance |
| Timeline |
| Vietnam Enterprise |
| JLEN Environmental Assets |
Vietnam Enterprise and JLEN Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vietnam Enterprise and JLEN Environmental
The main advantage of trading using opposite Vietnam Enterprise and JLEN Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam Enterprise position performs unexpectedly, JLEN Environmental 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 JLEN Environmental will offset losses from the drop in JLEN Environmental's long position.| Vietnam Enterprise vs. Quadrise Plc | Vietnam Enterprise vs. ImmuPharma PLC | Vietnam Enterprise vs. Intuitive Investments Group | Vietnam Enterprise vs. European Metals Holdings |
| JLEN Environmental vs. Golden Metal Resources | JLEN Environmental vs. Gamma Communications PLC | JLEN Environmental vs. URU Metals | JLEN Environmental vs. Aeorema Communications Plc |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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