Correlation Between Thanh Dat and Ha Long

Can any of the company-specific risk be diversified away by investing in both Thanh Dat and Ha Long 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 Ha Long 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 Ha Long Investment, you can compare the effects of market volatilities on Thanh Dat and Ha Long 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 Ha Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and Ha Long.

Diversification Opportunities for Thanh Dat and Ha Long

-0.72

Correlation Coefficient

Thanh Dat  Ha Long

Pay attention - limited upside

The 3 months correlation between Thanh and HID is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and Ha Long Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ha Long Investment 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 Ha Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ha Long Investment has no effect on the direction of Thanh Dat i.e., Thanh Dat and Ha Long go up and down completely randomly.

Pair Corralation between Thanh Dat and Ha Long

Assuming the 90 days trading horizon Thanh Dat Investment is expected to under-perform the Ha Long. In addition to that, Thanh Dat is 1.34 times more volatile than Ha Long Investment. It trades about -0.17 of its total potential returns per unit of risk. Ha Long Investment is currently generating about 0.05 per unit of volatility. If you would invest  266,000  in Ha Long Investment on December 29, 2024 and sell it today you would earn a total of  8,000  from holding Ha Long Investment or generate 3.01% return on investment over 90 days.

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

Thanh Dat Investment  vs.  Ha Long Investment

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.

Ha Long Investment

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ha Long Investment are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Ha Long is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Thanh Dat and Ha Long

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

The idea behind Thanh Dat Investment and Ha Long 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.