Correlation Between Fecon Mining and Mobile World
Can any of the company-specific risk be diversified away by investing in both Fecon Mining and Mobile World 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 Mobile World 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 Mobile World Investment, you can compare the effects of market volatilities on Fecon Mining and Mobile World 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 Mobile World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fecon Mining and Mobile World.
Diversification Opportunities for Fecon Mining and Mobile World
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fecon and Mobile is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Fecon Mining JSC and Mobile World Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile World 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 Mobile World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile World Investment has no effect on the direction of Fecon Mining i.e., Fecon Mining and Mobile World go up and down completely randomly.
Pair Corralation between Fecon Mining and Mobile World
Assuming the 90 days trading horizon Fecon Mining JSC is expected to generate 0.89 times more return on investment than Mobile World. However, Fecon Mining JSC is 1.12 times less risky than Mobile World. It trades about -0.15 of its potential returns per unit of risk. Mobile World Investment is currently generating about -0.23 per unit of risk. If you would invest 336,000 in Fecon Mining JSC on August 29, 2024 and sell it today you would lose (17,000) from holding Fecon Mining JSC or give up 5.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fecon Mining JSC vs. Mobile World Investment
Performance |
| Timeline |
| Fecon Mining JSC |
| Mobile World Investment |
Fecon Mining and Mobile World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fecon Mining and Mobile World
The main advantage of trading using opposite Fecon Mining and Mobile World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fecon Mining position performs unexpectedly, Mobile World 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 Mobile World will offset losses from the drop in Mobile World's long position.| Fecon Mining vs. FIT INVEST JSC | Fecon Mining vs. Damsan JSC | Fecon Mining vs. An Phat Plastic | Fecon Mining vs. APG Securities Joint |
| Mobile World vs. Elcom Technology Communications | Mobile World vs. Construction JSC No5 | Mobile World vs. Fecon Mining JSC | Mobile World vs. Century Synthetic Fiber |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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