Correlation Between FIT INVEST and Ba Ria
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and Ba Ria 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 FIT INVEST and Ba Ria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIT INVEST JSC and Ba Ria Thermal, you can compare the effects of market volatilities on FIT INVEST and Ba Ria 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 FIT INVEST with a short position of Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and Ba Ria.
Diversification Opportunities for FIT INVEST and Ba Ria
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FIT and BTP is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and Ba Ria Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ba Ria Thermal and FIT INVEST 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 FIT INVEST JSC are associated (or correlated) with Ba Ria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ba Ria Thermal has no effect on the direction of FIT INVEST i.e., FIT INVEST and Ba Ria go up and down completely randomly.
Pair Corralation between FIT INVEST and Ba Ria
Assuming the 90 days trading horizon FIT INVEST JSC is expected to generate 1.77 times more return on investment than Ba Ria. However, FIT INVEST is 1.77 times more volatile than Ba Ria Thermal. It trades about -0.02 of its potential returns per unit of risk. Ba Ria Thermal is currently generating about -0.27 per unit of risk. If you would invest 430,000 in FIT INVEST JSC on August 29, 2024 and sell it today you would lose (12,000) from holding FIT INVEST JSC or give up 2.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIT INVEST JSC vs. Ba Ria Thermal
Performance |
| Timeline |
| FIT INVEST JSC |
| Ba Ria Thermal |
FIT INVEST and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIT INVEST and Ba Ria
The main advantage of trading using opposite FIT INVEST and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, Ba Ria 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 Ba Ria will offset losses from the drop in Ba Ria's long position.| FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. Alphanam ME | FIT INVEST vs. APG Securities Joint |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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