Correlation Between Thanh Dat and PV2 Investment

Can any of the company-specific risk be diversified away by investing in both Thanh Dat and PV2 Investment 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 PV2 Investment 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 PV2 Investment JSC, you can compare the effects of market volatilities on Thanh Dat and PV2 Investment 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 PV2 Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanh Dat and PV2 Investment.

Diversification Opportunities for Thanh Dat and PV2 Investment

-0.87

Correlation Coefficient

Thanh Dat  PV2 Investment

Pay attention - limited upside

The 3 months correlation between Thanh and PV2 is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Thanh Dat Investment and PV2 Investment JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PV2 Investment 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 PV2 Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PV2 Investment JSC has no effect on the direction of Thanh Dat i.e., Thanh Dat and PV2 Investment go up and down completely randomly.

Pair Corralation between Thanh Dat and PV2 Investment

Assuming the 90 days trading horizon Thanh Dat Investment is expected to under-perform the PV2 Investment. But the stock apears to be less risky and, when comparing its historical volatility, Thanh Dat Investment is 3.06 times less risky than PV2 Investment. The stock trades about -0.19 of its potential returns per unit of risk. The PV2 Investment JSC is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  250,000  in PV2 Investment JSC on December 26, 2024 and sell it today you would earn a total of  80,000  from holding PV2 Investment JSC or generate 32.0% return on investment over 90 days.

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

Thanh Dat Investment  vs.  PV2 Investment 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.

PV2 Investment JSC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PV2 Investment JSC are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, PV2 Investment displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thanh Dat and PV2 Investment

The main advantage of trading using opposite Thanh Dat and PV2 Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thanh Dat position performs unexpectedly, PV2 Investment 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 PV2 Investment will offset losses from the drop in PV2 Investment's long position.

The idea behind Thanh Dat Investment and PV2 Investment 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.

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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.