Correlation Between Ba Ria and FIT INVEST
Can any of the company-specific risk be diversified away by investing in both Ba Ria and FIT INVEST 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 Ba Ria and FIT INVEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ba Ria Thermal and FIT INVEST JSC, you can compare the effects of market volatilities on Ba Ria and FIT INVEST 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 Ba Ria with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ba Ria and FIT INVEST.
Diversification Opportunities for Ba Ria and FIT INVEST
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BTP and FIT is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Ba Ria Thermal and FIT INVEST JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIT INVEST JSC and Ba Ria 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 Ba Ria Thermal are associated (or correlated) with FIT INVEST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIT INVEST JSC has no effect on the direction of Ba Ria i.e., Ba Ria and FIT INVEST go up and down completely randomly.
Pair Corralation between Ba Ria and FIT INVEST
Assuming the 90 days trading horizon Ba Ria Thermal is expected to under-perform the FIT INVEST. In addition to that, Ba Ria is 1.06 times more volatile than FIT INVEST JSC. It trades about -0.05 of its total potential returns per unit of risk. FIT INVEST JSC is currently generating about -0.01 per unit of volatility. If you would invest 449,000 in FIT INVEST JSC on August 29, 2024 and sell it today you would lose (31,000) from holding FIT INVEST JSC or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ba Ria Thermal vs. FIT INVEST JSC
Performance |
| Timeline |
| Ba Ria Thermal |
| FIT INVEST JSC |
Ba Ria and FIT INVEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ba Ria and FIT INVEST
The main advantage of trading using opposite Ba Ria and FIT INVEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ba Ria position performs unexpectedly, FIT INVEST 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 FIT INVEST will offset losses from the drop in FIT INVEST's long position.The idea behind Ba Ria Thermal and FIT INVEST JSC 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.| FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. Alphanam ME | FIT INVEST vs. APG Securities Joint |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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