Correlation Between Fecon Mining and DIC Holdings
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and DIC Holdings 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 Fecon Mining and DIC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fecon Mining JSC and DIC Holdings Construction, you can compare the effects of market volatilities on Fecon Mining and DIC Holdings 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 Fecon Mining with a short position of DIC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and DIC Holdings.
Diversification Opportunities for Fecon Mining and DIC Holdings
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fecon and DIC is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and DIC Holdings Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DIC Holdings Construction and Fecon Mining 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 Fecon Mining JSC are associated (or correlated) with DIC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DIC Holdings Construction has no effect on the direction of Fecon Mining i.e., Fecon Mining and DIC Holdings go up and down completely randomly.
Pair Corralation between Fecon Mining and DIC Holdings
Assuming the 90 days trading horizon Fecon Mining JSC is expected to under-perform the DIC Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Fecon Mining JSC is 2.64 times less risky than DIC Holdings. The stock trades about -0.08 of its potential returns per unit of risk. The DIC Holdings Construction is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,255,000 in DIC Holdings Construction on September 13, 2024 and sell it today you would earn a total of 100,000 from holding DIC Holdings Construction or generate 7.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fecon Mining JSC vs. DIC Holdings Construction
Performance |
| Timeline |
| Fecon Mining JSC |
| DIC Holdings Construction |
Fecon Mining and DIC Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and DIC Holdings
The main advantage of trading using opposite Fecon Mining and DIC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, DIC Holdings 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 DIC Holdings will offset losses from the drop in DIC Holdings' long position.| Fecon Mining vs. Danang Rubber JSC | Fecon Mining vs. DIC Holdings Construction | Fecon Mining vs. FPT Digital Retail | Fecon Mining vs. Binh Duong Trade |
| DIC Holdings vs. FPT Digital Retail | DIC Holdings vs. IDJ FINANCIAL | DIC Holdings vs. Century Synthetic Fiber | DIC Holdings vs. PostTelecommunication Equipment |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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