Correlation Between Vietnam Dairy and Atesco Industrial
Can any of the company-specific risk be diversified away by investing in both Vietnam Dairy and Atesco Industrial 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 Dairy and Atesco Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam Dairy Products and Atesco Industrial Cartering, you can compare the effects of market volatilities on Vietnam Dairy and Atesco Industrial 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 Dairy with a short position of Atesco Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam Dairy and Atesco Industrial.
Diversification Opportunities for Vietnam Dairy and Atesco Industrial
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vietnam and Atesco is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Dairy Products and Atesco Industrial Cartering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atesco Industrial and Vietnam Dairy 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 Dairy Products are associated (or correlated) with Atesco Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atesco Industrial has no effect on the direction of Vietnam Dairy i.e., Vietnam Dairy and Atesco Industrial go up and down completely randomly.
Pair Corralation between Vietnam Dairy and Atesco Industrial
Assuming the 90 days trading horizon Vietnam Dairy Products is expected to generate 0.06 times more return on investment than Atesco Industrial. However, Vietnam Dairy Products is 18.07 times less risky than Atesco Industrial. It trades about -0.06 of its potential returns per unit of risk. Atesco Industrial Cartering is currently generating about -0.13 per unit of risk. If you would invest 6,250,000 in Vietnam Dairy Products on November 7, 2024 and sell it today you would lose (30,000) from holding Vietnam Dairy Products or give up 0.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 87.5% |
| Values | Daily Returns |
Vietnam Dairy Products vs. Atesco Industrial Cartering
Performance |
| Timeline |
| Vietnam Dairy Products |
| Atesco Industrial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Vietnam Dairy and Atesco Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vietnam Dairy and Atesco Industrial
The main advantage of trading using opposite Vietnam Dairy and Atesco Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam Dairy position performs unexpectedly, Atesco Industrial 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 Atesco Industrial will offset losses from the drop in Atesco Industrial's long position.| Vietnam Dairy vs. FIT INVEST JSC | Vietnam Dairy vs. Damsan JSC | Vietnam Dairy vs. An Phat Plastic | Vietnam Dairy vs. APG Securities Joint |
| Atesco Industrial vs. Van Dien Fused | Atesco Industrial vs. Idico JSC | Atesco Industrial vs. Vietnam Medicinal Materials | Atesco Industrial vs. Hochiminh City Metal |
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 CEOs Directory module to screen CEOs from public companies around the world.
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