Correlation Between Vinhomes JSC and SMC Investment
Can any of the company-specific risk be diversified away by investing in both Vinhomes JSC and SMC Investment 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 Vinhomes JSC and SMC Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vinhomes JSC and SMC Investment Trading, you can compare the effects of market volatilities on Vinhomes JSC and SMC Investment 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 Vinhomes JSC with a short position of SMC Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vinhomes JSC and SMC Investment.
Diversification Opportunities for Vinhomes JSC and SMC Investment
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vinhomes and SMC is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Vinhomes JSC and SMC Investment Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMC Investment Trading and Vinhomes JSC 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 Vinhomes JSC are associated (or correlated) with SMC Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMC Investment Trading has no effect on the direction of Vinhomes JSC i.e., Vinhomes JSC and SMC Investment go up and down completely randomly.
Pair Corralation between Vinhomes JSC and SMC Investment
Assuming the 90 days trading horizon Vinhomes JSC is expected to generate 0.15 times more return on investment than SMC Investment. However, Vinhomes JSC is 6.64 times less risky than SMC Investment. It trades about -0.15 of its potential returns per unit of risk. SMC Investment Trading is currently generating about -0.45 per unit of risk. If you would invest 4,000,000 in Vinhomes JSC on November 4, 2024 and sell it today you would lose (50,000) from holding Vinhomes JSC or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vinhomes JSC vs. SMC Investment Trading
Performance |
| Timeline |
| Vinhomes JSC |
| SMC Investment Trading |
Vinhomes JSC and SMC Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vinhomes JSC and SMC Investment
The main advantage of trading using opposite Vinhomes JSC and SMC Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vinhomes JSC position performs unexpectedly, SMC Investment 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 SMC Investment will offset losses from the drop in SMC Investment's long position.| Vinhomes JSC vs. PostTelecommunication Equipment | Vinhomes JSC vs. TDT Investment and | Vinhomes JSC vs. Tng Investment And | Vinhomes JSC vs. Petrolimex International Trading |
| SMC Investment vs. Hanoi Beer Alcohol | SMC Investment vs. Saigon Viendong Technology | SMC Investment vs. Petrolimex Insurance Corp | SMC Investment vs. South Basic Chemicals |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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