Correlation Between Sao Mai and Construction

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

By analyzing existing cross correlation between Sao Mai Group and Construction And Investment, you can compare the effects of market volatilities on Sao Mai and Construction 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 Sao Mai with a short position of Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sao Mai and Construction.

Diversification Opportunities for Sao Mai and Construction

0.0

Correlation Coefficient

Sao Mai  Construction

Pay attention - limited upside

The 3 months correlation between Sao and Construction is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sao Mai Group and Construction And Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Construction And Inv and Sao Mai 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 Sao Mai Group are associated (or correlated) with Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Construction And Inv has no effect on the direction of Sao Mai i.e., Sao Mai and Construction go up and down completely randomly.

Pair Corralation between Sao Mai and Construction

If you would invest (100.00) in Sao Mai Group on October 9, 2024 and sell it today you would earn a total of  100.00  from holding Sao Mai Group or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Sao Mai Group  vs.  Construction And Investment

Sao Mai Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sao Mai Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Sao Mai is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Construction And Inv

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Construction And Investment are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Construction displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sao Mai and Construction

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

The idea behind Sao Mai Group and Construction And Investment 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.