Correlation Between Thanh Dat and FIT INVEST

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

By analyzing existing cross correlation between Thanh Dat Investment and FIT INVEST JSC, you can compare the effects of market volatilities on Thanh Dat and FIT INVEST 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 Thanh Dat with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and FIT INVEST.

Diversification Opportunities for Thanh Dat and FIT INVEST

0.01

Correlation Coefficient

Thanh Dat  FIT INVEST

Significant diversification

The 3 months correlation between Thanh and FIT is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and FIT INVEST JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIT INVEST JSC and Thanh Dat 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 Thanh Dat Investment are associated (or correlated) with FIT INVEST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIT INVEST JSC has no effect on the direction of Thanh Dat i.e., Thanh Dat and FIT INVEST go up and down completely randomly.

Pair Corralation between Thanh Dat and FIT INVEST

Assuming the 90 days trading horizon Thanh Dat Investment is expected to under-perform the FIT INVEST. In addition to that, Thanh Dat is 1.34 times more volatile than FIT INVEST JSC. It trades about -0.17 of its total potential returns per unit of risk. FIT INVEST JSC is currently generating about 0.14 per unit of volatility. If you would invest  421,000  in FIT INVEST JSC on December 29, 2024 and sell it today you would earn a total of  44,000  from holding FIT INVEST JSC or generate 10.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Thanh Dat Investment  vs.  FIT INVEST JSC

Thanh Dat Investment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thanh Dat Investment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

FIT INVEST JSC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FIT INVEST JSC are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, FIT INVEST may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Thanh Dat and FIT INVEST

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

The idea behind Thanh Dat Investment and FIT INVEST 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.