Correlation Between VTC Telecommunicatio and Nafoods Group
Can any of the company-specific risk be diversified away by investing in both VTC Telecommunicatio and Nafoods Group 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 VTC Telecommunicatio and Nafoods Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VTC Telecommunications JSC and Nafoods Group JSC, you can compare the effects of market volatilities on VTC Telecommunicatio and Nafoods Group 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 VTC Telecommunicatio with a short position of Nafoods Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of VTC Telecommunicatio and Nafoods Group.
Diversification Opportunities for VTC Telecommunicatio and Nafoods Group
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between VTC and Nafoods is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding VTC Telecommunications JSC and Nafoods Group JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nafoods Group JSC and VTC Telecommunicatio 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 VTC Telecommunications JSC are associated (or correlated) with Nafoods Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nafoods Group JSC has no effect on the direction of VTC Telecommunicatio i.e., VTC Telecommunicatio and Nafoods Group go up and down completely randomly.
Pair Corralation between VTC Telecommunicatio and Nafoods Group
Assuming the 90 days trading horizon VTC Telecommunications JSC is expected to generate 1.46 times more return on investment than Nafoods Group. However, VTC Telecommunicatio is 1.46 times more volatile than Nafoods Group JSC. It trades about 0.06 of its potential returns per unit of risk. Nafoods Group JSC is currently generating about -0.11 per unit of risk. If you would invest 810,000 in VTC Telecommunications JSC on August 29, 2024 and sell it today you would earn a total of 20,000 from holding VTC Telecommunications JSC or generate 2.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
VTC Telecommunications JSC vs. Nafoods Group JSC
Performance |
| Timeline |
| VTC Telecommunications |
| Nafoods Group JSC |
VTC Telecommunicatio and Nafoods Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VTC Telecommunicatio and Nafoods Group
The main advantage of trading using opposite VTC Telecommunicatio and Nafoods Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VTC Telecommunicatio position performs unexpectedly, Nafoods Group 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 Nafoods Group will offset losses from the drop in Nafoods Group's long position.| VTC Telecommunicatio vs. Idico JSC | VTC Telecommunicatio vs. Alphanam ME | VTC Telecommunicatio vs. Hochiminh City Metal | VTC Telecommunicatio vs. Atesco Industrial Cartering |
| Nafoods Group vs. FIT INVEST JSC | Nafoods Group vs. Damsan JSC | Nafoods Group vs. An Phat Plastic | Nafoods Group vs. APG Securities Joint |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |