Correlation Between Industrial Bank and Vieworks
Can any of the company-specific risk be diversified away by investing in both Industrial Bank and Vieworks 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 Vieworks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industrial Bank and Vieworks Co, you can compare the effects of market volatilities on Industrial Bank and Vieworks 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 Vieworks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and Vieworks.
Diversification Opportunities for Industrial Bank and Vieworks
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industrial and Vieworks is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank and Vieworks Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vieworks 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 Vieworks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vieworks has no effect on the direction of Industrial Bank i.e., Industrial Bank and Vieworks go up and down completely randomly.
Pair Corralation between Industrial Bank and Vieworks
Assuming the 90 days trading horizon Industrial Bank is expected to generate 0.71 times more return on investment than Vieworks. However, Industrial Bank is 1.4 times less risky than Vieworks. It trades about 0.11 of its potential returns per unit of risk. Vieworks Co is currently generating about -0.2 per unit of risk. If you would invest 1,359,000 in Industrial Bank on September 12, 2024 and sell it today you would earn a total of 109,000 from holding Industrial Bank or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Bank vs. Vieworks Co
Performance |
| Timeline |
| Industrial Bank |
| Vieworks |
Industrial Bank and Vieworks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and Vieworks
The main advantage of trading using opposite Industrial Bank and Vieworks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, Vieworks 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 Vieworks will offset losses from the drop in Vieworks' long position.| Industrial Bank vs. Nice Information Telecommunication | Industrial Bank vs. Lotte Data Communication | Industrial Bank vs. DataSolution | Industrial Bank vs. NICE Information Service |
| Vieworks vs. InBody CoLtd | Vieworks vs. Seegene | Vieworks vs. DIO Corporation | Vieworks vs. LEENO Industrial |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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