Correlation Between INTER CARS and SANOK RUBBER
Can any of the company-specific risk be diversified away by investing in both INTER CARS and SANOK RUBBER 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 INTER CARS and SANOK RUBBER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and SANOK RUBBER ZY, you can compare the effects of market volatilities on INTER CARS and SANOK RUBBER 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 INTER CARS with a short position of SANOK RUBBER. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and SANOK RUBBER.
Diversification Opportunities for INTER CARS and SANOK RUBBER
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between INTER and SANOK is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and SANOK RUBBER ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANOK RUBBER ZY and INTER CARS 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 INTER CARS SA are associated (or correlated) with SANOK RUBBER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANOK RUBBER ZY has no effect on the direction of INTER CARS i.e., INTER CARS and SANOK RUBBER go up and down completely randomly.
Pair Corralation between INTER CARS and SANOK RUBBER
Assuming the 90 days horizon INTER CARS SA is expected to generate 0.95 times more return on investment than SANOK RUBBER. However, INTER CARS SA is 1.06 times less risky than SANOK RUBBER. It trades about 0.2 of its potential returns per unit of risk. SANOK RUBBER ZY is currently generating about 0.18 per unit of risk. If you would invest 11,680 in INTER CARS SA on October 14, 2024 and sell it today you would earn a total of 840.00 from holding INTER CARS SA or generate 7.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTER CARS SA vs. SANOK RUBBER ZY
Performance |
| Timeline |
| INTER CARS SA |
| SANOK RUBBER ZY |
INTER CARS and SANOK RUBBER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and SANOK RUBBER
The main advantage of trading using opposite INTER CARS and SANOK RUBBER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS position performs unexpectedly, SANOK RUBBER 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 SANOK RUBBER will offset losses from the drop in SANOK RUBBER's long position.| INTER CARS vs. Monument Mining Limited | INTER CARS vs. Nucletron Electronic Aktiengesellschaft | INTER CARS vs. STORE ELECTRONIC | INTER CARS vs. STMicroelectronics NV |
| SANOK RUBBER vs. RCI Hospitality Holdings | SANOK RUBBER vs. INTER CARS SA | SANOK RUBBER vs. Molina Healthcare | SANOK RUBBER vs. HEALTHSTREAM |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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