Correlation Between Japan Vietnam and VTC Telecommunicatio

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

Diversification Opportunities for Japan Vietnam and VTC Telecommunicatio

-0.06

Correlation Coefficient

Japan Vietnam  VTC Telecommunicatio

Good diversification

The 3 months correlation between Japan and VTC is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Japan Vietnam Medical and VTC Telecommunications JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VTC Telecommunications 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 VTC Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VTC Telecommunications has no effect on the direction of Japan Vietnam i.e., Japan Vietnam and VTC Telecommunicatio go up and down completely randomly.

Pair Corralation between Japan Vietnam and VTC Telecommunicatio

Assuming the 90 days trading horizon Japan Vietnam Medical is expected to generate 2.21 times more return on investment than VTC Telecommunicatio. However, Japan Vietnam is 2.21 times more volatile than VTC Telecommunications JSC. It trades about 0.39 of its potential returns per unit of risk. VTC Telecommunications JSC is currently generating about 0.01 per unit of risk. If you would invest  304,000  in Japan Vietnam Medical on September 20, 2024 and sell it today you would earn a total of  71,000  from holding Japan Vietnam Medical or generate 23.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Japan Vietnam Medical  vs.  VTC Telecommunications JSC

Japan Vietnam Medical

Risk-Adjusted Performance

9 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Japan Vietnam Medical are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Japan Vietnam may actually be approaching a critical reversion point that can send shares even higher in January 2025.

VTC Telecommunications

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VTC Telecommunications JSC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Japan Vietnam and VTC Telecommunicatio

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

The idea behind Japan Vietnam Medical and VTC Telecommunications 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.