Correlation Between Travel Investment and FIT INVEST
Can any of the company-specific risk be diversified away by investing in both Travel Investment 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 Travel Investment and FIT INVEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Travel Investment and and FIT INVEST JSC, you can compare the effects of market volatilities on Travel Investment 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 Travel Investment with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travel Investment and FIT INVEST.
Diversification Opportunities for Travel Investment and FIT INVEST
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Travel and FIT is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Travel Investment and 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 Travel Investment 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 Travel Investment and 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 Travel Investment i.e., Travel Investment and FIT INVEST go up and down completely randomly.
Pair Corralation between Travel Investment and FIT INVEST
Assuming the 90 days trading horizon Travel Investment and is expected to generate 1.35 times more return on investment than FIT INVEST. However, Travel Investment is 1.35 times more volatile than FIT INVEST JSC. It trades about 0.04 of its potential returns per unit of risk. FIT INVEST JSC is currently generating about -0.2 per unit of risk. If you would invest 740,000 in Travel Investment and on September 1, 2024 and sell it today you would earn a total of 5,000 from holding Travel Investment and or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 54.55% |
| Values | Daily Returns |
Travel Investment and vs. FIT INVEST JSC
Performance |
| Timeline |
| Travel Investment |
| FIT INVEST JSC |
Travel Investment and FIT INVEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travel Investment and FIT INVEST
The main advantage of trading using opposite Travel Investment and FIT INVEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travel Investment 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.| Travel Investment vs. FIT INVEST JSC | Travel Investment vs. Damsan JSC | Travel Investment vs. An Phat Plastic | Travel Investment vs. Alphanam ME |
| FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. Alphanam ME | 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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