Correlation Between Vietnam National and Thanh Dat
Can any of the company-specific risk be diversified away by investing in both Vietnam National and Thanh Dat 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 National and Thanh Dat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vietnam National Reinsurance and Thanh Dat Investment, you can compare the effects of market volatilities on Vietnam National and Thanh Dat 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 National with a short position of Thanh Dat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam National and Thanh Dat.
Diversification Opportunities for Vietnam National and Thanh Dat
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Vietnam and Thanh is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam National Reinsurance and Thanh Dat Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanh Dat Investment and Vietnam National 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 National Reinsurance are associated (or correlated) with Thanh Dat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanh Dat Investment has no effect on the direction of Vietnam National i.e., Vietnam National and Thanh Dat go up and down completely randomly.
Pair Corralation between Vietnam National and Thanh Dat
Assuming the 90 days trading horizon Vietnam National Reinsurance is expected to generate 0.4 times more return on investment than Thanh Dat. However, Vietnam National Reinsurance is 2.52 times less risky than Thanh Dat. It trades about 0.08 of its potential returns per unit of risk. Thanh Dat Investment is currently generating about -0.15 per unit of risk. If you would invest 2,154,546 in Vietnam National Reinsurance on October 11, 2024 and sell it today you would earn a total of 25,454 from holding Vietnam National Reinsurance or generate 1.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vietnam National Reinsurance vs. Thanh Dat Investment
Performance |
| Timeline |
| Vietnam National Rei |
| Thanh Dat Investment |
Vietnam National and Thanh Dat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vietnam National and Thanh Dat
The main advantage of trading using opposite Vietnam National and Thanh Dat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vietnam National position performs unexpectedly, Thanh Dat 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 Thanh Dat will offset losses from the drop in Thanh Dat's long position.| Vietnam National vs. Construction And Investment | Vietnam National vs. Development Investment Construction | Vietnam National vs. Saigon Beer Alcohol | Vietnam National vs. SMC Investment Trading |
| Thanh Dat vs. Kien Giang Construction | Thanh Dat vs. BIDV Insurance Corp | Thanh Dat vs. Vietnam National Reinsurance | Thanh Dat vs. Development Investment Construction |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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