Correlation Between Viet Thanh and DOMESCO Medical
Can any of the company-specific risk be diversified away by investing in both Viet Thanh and DOMESCO Medical 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 DOMESCO Medical 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 DOMESCO Medical Import, you can compare the effects of market volatilities on Viet Thanh and DOMESCO Medical 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 DOMESCO Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viet Thanh and DOMESCO Medical.
Diversification Opportunities for Viet Thanh and DOMESCO Medical
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Viet and DOMESCO is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Viet Thanh Plastic and DOMESCO Medical Import in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DOMESCO Medical Import 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 DOMESCO Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DOMESCO Medical Import has no effect on the direction of Viet Thanh i.e., Viet Thanh and DOMESCO Medical go up and down completely randomly.
Pair Corralation between Viet Thanh and DOMESCO Medical
Assuming the 90 days trading horizon Viet Thanh Plastic is expected to generate 1.29 times more return on investment than DOMESCO Medical. However, Viet Thanh is 1.29 times more volatile than DOMESCO Medical Import. It trades about 0.14 of its potential returns per unit of risk. DOMESCO Medical Import is currently generating about -0.12 per unit of risk. If you would invest 1,620,000 in Viet Thanh Plastic on September 2, 2024 and sell it today you would earn a total of 80,000 from holding Viet Thanh Plastic or generate 4.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 76.19% |
| Values | Daily Returns |
Viet Thanh Plastic vs. DOMESCO Medical Import
Performance |
| Timeline |
| Viet Thanh Plastic |
| DOMESCO Medical Import |
Viet Thanh and DOMESCO Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viet Thanh and DOMESCO Medical
The main advantage of trading using opposite Viet Thanh and DOMESCO Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viet Thanh position performs unexpectedly, DOMESCO Medical 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 DOMESCO Medical will offset losses from the drop in DOMESCO Medical's long position.| Viet Thanh vs. PVI Reinsurance Corp | Viet Thanh vs. Riverway Management JSC | Viet Thanh vs. CEO Group JSC | Viet Thanh vs. Ducgiang Chemicals Detergent |
| DOMESCO Medical vs. Viet Thanh Plastic | DOMESCO Medical vs. Tri Viet Management | DOMESCO Medical vs. Hochiminh City Metal | DOMESCO Medical 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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