Correlation Between Vu Dang and Elcom Technology
Can any of the company-specific risk be diversified away by investing in both Vu Dang and Elcom Technology 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 Vu Dang and Elcom Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vu Dang Investment and Elcom Technology Communications, you can compare the effects of market volatilities on Vu Dang and Elcom Technology 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 Vu Dang with a short position of Elcom Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vu Dang and Elcom Technology.
Diversification Opportunities for Vu Dang and Elcom Technology
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SVD and Elcom is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Vu Dang Investment and Elcom Technology Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elcom Technology Com and Vu Dang 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 Vu Dang Investment are associated (or correlated) with Elcom Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elcom Technology Com has no effect on the direction of Vu Dang i.e., Vu Dang and Elcom Technology go up and down completely randomly.
Pair Corralation between Vu Dang and Elcom Technology
Assuming the 90 days trading horizon Vu Dang Investment is expected to generate 0.67 times more return on investment than Elcom Technology. However, Vu Dang Investment is 1.5 times less risky than Elcom Technology. It trades about 0.02 of its potential returns per unit of risk. Elcom Technology Communications is currently generating about -0.04 per unit of risk. If you would invest 326,000 in Vu Dang Investment on December 28, 2024 and sell it today you would earn a total of 3,000 from holding Vu Dang Investment or generate 0.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Vu Dang Investment vs. Elcom Technology Communication
Performance |
Timeline |
Vu Dang Investment |
Elcom Technology Com |
Vu Dang and Elcom Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Vu Dang and Elcom Technology
The main advantage of trading using opposite Vu Dang and Elcom Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vu Dang position performs unexpectedly, Elcom Technology 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 Elcom Technology will offset losses from the drop in Elcom Technology's long position.Vu Dang vs. Mobile World Investment | Vu Dang vs. Saigon Telecommunication Technologies | Vu Dang vs. Innovative Technology Development | Vu Dang vs. South Basic Chemicals |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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