Correlation Between Japan Vietnam and Ho Chi

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

By analyzing existing cross correlation between Japan Vietnam Medical and Ho Chi Minh, you can compare the effects of market volatilities on Japan Vietnam and Ho Chi 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 Japan Vietnam with a short position of Ho Chi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Japan Vietnam and Ho Chi.

Diversification Opportunities for Japan Vietnam and Ho Chi

-0.12

Correlation Coefficient

Japan Vietnam  Ho Chi

Good diversification

The 3 months correlation between Japan and HDB is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Japan Vietnam Medical and Ho Chi Minh in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ho Chi Minh and Japan Vietnam 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 Japan Vietnam Medical are associated (or correlated) with Ho Chi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ho Chi Minh has no effect on the direction of Japan Vietnam i.e., Japan Vietnam and Ho Chi go up and down completely randomly.

Pair Corralation between Japan Vietnam and Ho Chi

Assuming the 90 days trading horizon Japan Vietnam Medical is expected to generate 1.31 times more return on investment than Ho Chi. However, Japan Vietnam is 1.31 times more volatile than Ho Chi Minh. It trades about 0.24 of its potential returns per unit of risk. Ho Chi Minh is currently generating about 0.0 per unit of risk. If you would invest  377,000  in Japan Vietnam Medical on December 20, 2024 and sell it today you would earn a total of  150,000  from holding Japan Vietnam Medical or generate 39.79% return on investment over 90 days.

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

Japan Vietnam Medical  vs.  Ho Chi Minh

Japan Vietnam Medical

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Japan Vietnam Medical are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Japan Vietnam displayed solid returns over the last few months and may actually be approaching a breakup point.

Ho Chi Minh

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ho Chi Minh has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Ho Chi is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Japan Vietnam and Ho Chi

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

The idea behind Japan Vietnam Medical and Ho Chi Minh 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..