Correlation Between Viet Thanh and Dong A
Can any of the company-specific risk be diversified away by investing in both Viet Thanh and Dong A 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 Viet Thanh and Dong A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viet Thanh Plastic and Dong A Hotel, you can compare the effects of market volatilities on Viet Thanh and Dong A 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 Viet Thanh with a short position of Dong A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viet Thanh and Dong A.
Diversification Opportunities for Viet Thanh and Dong A
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Viet and Dong is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Viet Thanh Plastic and Dong A Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dong A Hotel and Viet Thanh 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 Viet Thanh Plastic are associated (or correlated) with Dong A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dong A Hotel has no effect on the direction of Viet Thanh i.e., Viet Thanh and Dong A go up and down completely randomly.
Pair Corralation between Viet Thanh and Dong A
Assuming the 90 days trading horizon Viet Thanh Plastic is expected to generate 1.49 times more return on investment than Dong A. However, Viet Thanh is 1.49 times more volatile than Dong A Hotel. It trades about 0.15 of its potential returns per unit of risk. Dong A Hotel is currently generating about -0.04 per unit of risk. If you would invest 810,000 in Viet Thanh Plastic on November 8, 2024 and sell it today you would earn a total of 960,000 from holding Viet Thanh Plastic or generate 118.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Viet Thanh Plastic vs. Dong A Hotel
Performance |
| Timeline |
| Viet Thanh Plastic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Dong A Hotel |
Viet Thanh and Dong A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viet Thanh and Dong A
The main advantage of trading using opposite Viet Thanh and Dong A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viet Thanh position performs unexpectedly, Dong A 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 Dong A will offset losses from the drop in Dong A's long position.| Viet Thanh vs. Phuoc Hoa Rubber | Viet Thanh vs. HVC Investment and | Viet Thanh vs. Pha Le Plastics | Viet Thanh vs. An Phat Plastic |
| Dong A vs. Bao Ngoc Investment | Dong A vs. Hcd Investment Producing | Dong A vs. Vincom Retail JSC | Dong A vs. FPT Digital Retail |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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