Correlation Between An Phat and Mekong Fisheries

Can any of the company-specific risk be diversified away by investing in both An Phat and Mekong Fisheries 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 An Phat and Mekong Fisheries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between An Phat Plastic and Mekong Fisheries JSC, you can compare the effects of market volatilities on An Phat and Mekong Fisheries 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 An Phat with a short position of Mekong Fisheries. Check out your portfolio center. Please also check ongoing floating volatility patterns of An Phat and Mekong Fisheries.

Diversification Opportunities for An Phat and Mekong Fisheries

0.13

Correlation Coefficient

An Phat  Mekong Fisheries

Average diversification

The 3 months correlation between AAA and Mekong is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding An Phat Plastic and Mekong Fisheries JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mekong Fisheries JSC and An Phat 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 An Phat Plastic are associated (or correlated) with Mekong Fisheries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mekong Fisheries JSC has no effect on the direction of An Phat i.e., An Phat and Mekong Fisheries go up and down completely randomly.

Pair Corralation between An Phat and Mekong Fisheries

Assuming the 90 days trading horizon An Phat is expected to generate 1.37 times less return on investment than Mekong Fisheries. But when comparing it to its historical volatility, An Phat Plastic is 1.5 times less risky than Mekong Fisheries. It trades about 0.13 of its potential returns per unit of risk. Mekong Fisheries JSC is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  700,000  in Mekong Fisheries JSC on November 19, 2024 and sell it today you would earn a total of  26,000  from holding Mekong Fisheries JSC or generate 3.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	82.35%
Values	Daily Returns

An Phat Plastic  vs.  Mekong Fisheries JSC

An Phat Plastic

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in An Phat Plastic are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, An Phat may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Mekong Fisheries JSC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mekong Fisheries JSC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy primary indicators, Mekong Fisheries is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with An Phat and Mekong Fisheries

The main advantage of trading using opposite An Phat and Mekong Fisheries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if An Phat position performs unexpectedly, Mekong Fisheries 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 Mekong Fisheries will offset losses from the drop in Mekong Fisheries' long position.

The idea behind An Phat Plastic and Mekong Fisheries JSC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stocks Directory module to find actively traded stocks across global markets.