Correlation Between Southern Rubber and FIT INVEST
Can any of the company-specific risk be diversified away by investing in both Southern Rubber 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 Southern Rubber and FIT INVEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Rubber Industry and FIT INVEST JSC, you can compare the effects of market volatilities on Southern Rubber 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 Southern Rubber with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Rubber and FIT INVEST.
Diversification Opportunities for Southern Rubber and FIT INVEST
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Southern and FIT is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Southern Rubber Industry 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 Southern Rubber 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 Southern Rubber Industry 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 Southern Rubber i.e., Southern Rubber and FIT INVEST go up and down completely randomly.
Pair Corralation between Southern Rubber and FIT INVEST
Assuming the 90 days trading horizon Southern Rubber Industry is expected to generate 1.04 times more return on investment than FIT INVEST. However, Southern Rubber is 1.04 times more volatile than FIT INVEST JSC. It trades about 0.0 of its potential returns per unit of risk. FIT INVEST JSC is currently generating about -0.04 per unit of risk. If you would invest 1,340,868 in Southern Rubber Industry on August 28, 2024 and sell it today you would lose (50,868) from holding Southern Rubber Industry or give up 3.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southern Rubber Industry vs. FIT INVEST JSC
Performance |
| Timeline |
| Southern Rubber Industry |
| FIT INVEST JSC |
Southern Rubber and FIT INVEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Rubber and FIT INVEST
The main advantage of trading using opposite Southern Rubber and FIT INVEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Rubber 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.| Southern Rubber vs. FIT INVEST JSC | Southern Rubber vs. Damsan JSC | Southern Rubber vs. An Phat Plastic | Southern Rubber vs. APG Securities Joint |
| FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. APG Securities Joint | FIT INVEST vs. Binhthuan Agriculture Services |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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