Correlation Between MB Securities and Tien Giang

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

By analyzing existing cross correlation between MB Securities JSC and Tien Giang Investment, you can compare the effects of market volatilities on MB Securities and Tien Giang 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 MB Securities with a short position of Tien Giang. Check out your portfolio center. Please also check ongoing floating volatility patterns of MB Securities and Tien Giang.

Diversification Opportunities for MB Securities and Tien Giang

0.03

Correlation Coefficient

MB Securities  Tien Giang

Significant diversification

The 3 months correlation between MBS and Tien is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding MB Securities JSC and Tien Giang Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tien Giang Investment and MB 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 MB Securities JSC are associated (or correlated) with Tien Giang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tien Giang Investment has no effect on the direction of MB Securities i.e., MB Securities and Tien Giang go up and down completely randomly.

Pair Corralation between MB Securities and Tien Giang

Assuming the 90 days trading horizon MB Securities JSC is expected to generate 2.39 times more return on investment than Tien Giang. However, MB Securities is 2.39 times more volatile than Tien Giang Investment. It trades about 0.08 of its potential returns per unit of risk. Tien Giang Investment is currently generating about 0.09 per unit of risk. If you would invest  1,494,305  in MB Securities JSC on September 30, 2024 and sell it today you would earn a total of  1,385,695  from holding MB Securities JSC or generate 92.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.73%
Values	Daily Returns

MB Securities JSC  vs.  Tien Giang Investment

MB Securities JSC

Risk-Adjusted Performance

0 of 100

Very Weak

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

Tien Giang Investment

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tien Giang Investment are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, Tien Giang may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with MB Securities and Tien Giang

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

The idea behind MB Securities JSC and Tien Giang 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.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.