Correlation Between FIT INVEST and FPT Securities
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and FPT Securities 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 FPT Securities 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 FPT Securities JSC, you can compare the effects of market volatilities on FIT INVEST and FPT Securities 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 FPT Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and FPT Securities.
Diversification Opportunities for FIT INVEST and FPT Securities
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FIT and FPT is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and FPT Securities JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FPT Securities JSC 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 FPT Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FPT Securities JSC has no effect on the direction of FIT INVEST i.e., FIT INVEST and FPT Securities go up and down completely randomly.
Pair Corralation between FIT INVEST and FPT Securities
Assuming the 90 days trading horizon FIT INVEST JSC is expected to under-perform the FPT Securities. But the stock apears to be less risky and, when comparing its historical volatility, FIT INVEST JSC is 1.68 times less risky than FPT Securities. The stock trades about -0.03 of its potential returns per unit of risk. The FPT Securities JSC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,017,644 in FPT Securities JSC on September 2, 2024 and sell it today you would earn a total of 1,442,356 from holding FPT Securities JSC or generate 47.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIT INVEST JSC vs. FPT Securities JSC
Performance |
| Timeline |
| FIT INVEST JSC |
| FPT Securities JSC |
FIT INVEST and FPT Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIT INVEST and FPT Securities
The main advantage of trading using opposite FIT INVEST and FPT Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, FPT Securities 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 FPT Securities will offset losses from the drop in FPT Securities' long position.| FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. Alphanam ME | FIT INVEST vs. Binhthuan Agriculture Services |
| FPT Securities vs. FIT INVEST JSC | FPT Securities vs. Damsan JSC | FPT Securities vs. An Phat Plastic | FPT Securities vs. Alphanam ME |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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