Correlation Between APG Securities and Lam Dong

Can any of the company-specific risk be diversified away by investing in both APG Securities and Lam Dong 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 APG Securities and Lam Dong into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between APG Securities Joint and Lam Dong Pharmaceutical, you can compare the effects of market volatilities on APG Securities and Lam Dong 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 APG Securities with a short position of Lam Dong. Check out your portfolio center. Please also check ongoing floating volatility patterns of APG Securities and Lam Dong.

Diversification Opportunities for APG Securities and Lam Dong

0.7

Correlation Coefficient

APG Securities  Lam Dong

Poor diversification

The 3 months correlation between APG and Lam is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding APG Securities Joint and Lam Dong Pharmaceutical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lam Dong Pharmaceutical and APG Securities 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 APG Securities Joint are associated (or correlated) with Lam Dong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lam Dong Pharmaceutical has no effect on the direction of APG Securities i.e., APG Securities and Lam Dong go up and down completely randomly.

Pair Corralation between APG Securities and Lam Dong

Assuming the 90 days trading horizon APG Securities is expected to generate 3.09 times less return on investment than Lam Dong. But when comparing it to its historical volatility, APG Securities Joint is 1.56 times less risky than Lam Dong. It trades about 0.03 of its potential returns per unit of risk. Lam Dong Pharmaceutical is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  540,000  in Lam Dong Pharmaceutical on September 28, 2024 and sell it today you would earn a total of  490,000  from holding Lam Dong Pharmaceutical or generate 90.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	90.06%
Values	Daily Returns

APG Securities Joint  vs.  Lam Dong Pharmaceutical

APG Securities Joint

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days APG Securities Joint 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Lam Dong Pharmaceutical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lam Dong Pharmaceutical 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 basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with APG Securities and Lam Dong

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

The idea behind APG Securities Joint and Lam Dong Pharmaceutical 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.