Correlation Between Fecon Mining and Dinhvu Port
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and Dinhvu Port 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 Dinhvu Port 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 Dinhvu Port Investment, you can compare the effects of market volatilities on Fecon Mining and Dinhvu Port 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 Dinhvu Port. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and Dinhvu Port.
Diversification Opportunities for Fecon Mining and Dinhvu Port
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fecon and Dinhvu is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and Dinhvu Port Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dinhvu Port Investment 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 Dinhvu Port. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dinhvu Port Investment has no effect on the direction of Fecon Mining i.e., Fecon Mining and Dinhvu Port go up and down completely randomly.
Pair Corralation between Fecon Mining and Dinhvu Port
Assuming the 90 days trading horizon Fecon Mining JSC is expected to under-perform the Dinhvu Port. In addition to that, Fecon Mining is 1.45 times more volatile than Dinhvu Port Investment. It trades about -0.07 of its total potential returns per unit of risk. Dinhvu Port Investment is currently generating about 0.1 per unit of volatility. If you would invest 5,313,083 in Dinhvu Port Investment on September 12, 2024 and sell it today you would earn a total of 2,796,917 from holding Dinhvu Port Investment or generate 52.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fecon Mining JSC vs. Dinhvu Port Investment
Performance |
| Timeline |
| Fecon Mining JSC |
| Dinhvu Port Investment |
Fecon Mining and Dinhvu Port Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and Dinhvu Port
The main advantage of trading using opposite Fecon Mining and Dinhvu Port positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, Dinhvu Port 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 Dinhvu Port will offset losses from the drop in Dinhvu Port's long position.| Fecon Mining vs. FIT INVEST JSC | Fecon Mining vs. Damsan JSC | Fecon Mining vs. An Phat Plastic | Fecon Mining vs. Alphanam ME |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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