Correlation Between Industrial Bank and EXA EC
Can any of the company-specific risk be diversified away by investing in both Industrial Bank and EXA EC 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 Industrial Bank and EXA EC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industrial Bank and EXA EC Inc, you can compare the effects of market volatilities on Industrial Bank and EXA EC 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 Industrial Bank with a short position of EXA EC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and EXA EC.
Diversification Opportunities for Industrial Bank and EXA EC
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Industrial and EXA is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank and EXA EC Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXA EC Inc and Industrial Bank 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 Industrial Bank are associated (or correlated) with EXA EC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXA EC Inc has no effect on the direction of Industrial Bank i.e., Industrial Bank and EXA EC go up and down completely randomly.
Pair Corralation between Industrial Bank and EXA EC
Assuming the 90 days trading horizon Industrial Bank is expected to generate 0.51 times more return on investment than EXA EC. However, Industrial Bank is 1.95 times less risky than EXA EC. It trades about 0.07 of its potential returns per unit of risk. EXA EC Inc is currently generating about -0.05 per unit of risk. If you would invest 1,346,000 in Industrial Bank on September 2, 2024 and sell it today you would earn a total of 142,000 from holding Industrial Bank or generate 10.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Bank vs. EXA EC Inc
Performance |
| Timeline |
| Industrial Bank |
| EXA EC Inc |
Industrial Bank and EXA EC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and EXA EC
The main advantage of trading using opposite Industrial Bank and EXA EC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, EXA EC 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 EXA EC will offset losses from the drop in EXA EC's long position.| Industrial Bank vs. E Investment Development | Industrial Bank vs. Atinum Investment Co | Industrial Bank vs. Pureun Mutual Savings | Industrial Bank vs. SK Chemicals Co |
| EXA EC vs. Handok Clean Tech | EXA EC vs. Pungguk Ethanol Industrial | EXA EC vs. Polaris Office Corp | EXA EC vs. Hansol Homedeco Co |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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