Correlation Between POST TELECOMMU and Thanh Dat

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

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

Diversification Opportunities for POST TELECOMMU and Thanh Dat

0.33

Correlation Coefficient

POST TELECOMMU  Thanh Dat

Weak diversification

The 3 months correlation between POST and Thanh is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding POST TELECOMMU and Thanh Dat Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanh Dat Investment and POST TELECOMMU 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 POST TELECOMMU are associated (or correlated) with Thanh Dat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanh Dat Investment has no effect on the direction of POST TELECOMMU i.e., POST TELECOMMU and Thanh Dat go up and down completely randomly.

Pair Corralation between POST TELECOMMU and Thanh Dat

Assuming the 90 days trading horizon POST TELECOMMU is expected to generate 5.19 times less return on investment than Thanh Dat. In addition to that, POST TELECOMMU is 1.16 times more volatile than Thanh Dat Investment. It trades about 0.01 of its total potential returns per unit of risk. Thanh Dat Investment is currently generating about 0.07 per unit of volatility. If you would invest  1,066,163  in Thanh Dat Investment on October 11, 2024 and sell it today you would earn a total of  1,523,837  from holding Thanh Dat Investment or generate 142.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	83.3%
Values	Daily Returns

POST TELECOMMU  vs.  Thanh Dat Investment

POST TELECOMMU

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in POST TELECOMMU are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, POST TELECOMMU displayed solid returns over the last few months and may actually be approaching a breakup point.

Thanh Dat Investment

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thanh Dat Investment are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Thanh Dat is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with POST TELECOMMU and Thanh Dat

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

The idea behind POST TELECOMMU and Thanh Dat 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 Transaction History module to view history of all your transactions and understand their impact on performance.