Correlation Between Chiba Bank and Virco Manufacturing
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Virco Manufacturing 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 Chiba Bank and Virco Manufacturing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank Ltd and Virco Manufacturing, you can compare the effects of market volatilities on Chiba Bank and Virco Manufacturing 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 Chiba Bank with a short position of Virco Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Virco Manufacturing.
Diversification Opportunities for Chiba Bank and Virco Manufacturing
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chiba and Virco is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank Ltd and Virco Manufacturing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virco Manufacturing and Chiba 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 Chiba Bank Ltd are associated (or correlated) with Virco Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virco Manufacturing has no effect on the direction of Chiba Bank i.e., Chiba Bank and Virco Manufacturing go up and down completely randomly.
Pair Corralation between Chiba Bank and Virco Manufacturing
If you would invest 1,396 in Virco Manufacturing on August 25, 2024 and sell it today you would earn a total of 187.00 from holding Virco Manufacturing or generate 13.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiba Bank Ltd vs. Virco Manufacturing
Performance |
| Timeline |
| Chiba Bank |
| Virco Manufacturing |
Chiba Bank and Virco Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Virco Manufacturing
The main advantage of trading using opposite Chiba Bank and Virco Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Virco Manufacturing 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 Virco Manufacturing will offset losses from the drop in Virco Manufacturing's long position.| Chiba Bank vs. Standard Bank Group | Chiba Bank vs. Bank Central Asia | Chiba Bank vs. PSB Holdings | Chiba Bank vs. United Overseas Bank |
| Virco Manufacturing vs. Bassett Furniture Industries | Virco Manufacturing vs. Hooker Furniture | Virco Manufacturing vs. Natuzzi SpA | Virco Manufacturing vs. Flexsteel Industries |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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