Correlation Between FIT INVEST and Binh Duong
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and Binh Duong 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 Binh Duong 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 Binh Duong Mineral, you can compare the effects of market volatilities on FIT INVEST and Binh Duong 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 Binh Duong. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and Binh Duong.
Diversification Opportunities for FIT INVEST and Binh Duong
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FIT and Binh is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and Binh Duong Mineral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Duong Mineral 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 Binh Duong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binh Duong Mineral has no effect on the direction of FIT INVEST i.e., FIT INVEST and Binh Duong go up and down completely randomly.
Pair Corralation between FIT INVEST and Binh Duong
Assuming the 90 days trading horizon FIT INVEST JSC is expected to under-perform the Binh Duong. But the stock apears to be less risky and, when comparing its historical volatility, FIT INVEST JSC is 1.33 times less risky than Binh Duong. The stock trades about -0.04 of its potential returns per unit of risk. The Binh Duong Mineral is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 2,707,969 in Binh Duong Mineral on September 12, 2024 and sell it today you would lose (877,969) from holding Binh Duong Mineral or give up 32.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.72% |
| Values | Daily Returns |
FIT INVEST JSC vs. Binh Duong Mineral
Performance |
| Timeline |
| FIT INVEST JSC |
| Binh Duong Mineral |
FIT INVEST and Binh Duong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIT INVEST and Binh Duong
The main advantage of trading using opposite FIT INVEST and Binh Duong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, Binh Duong 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 Binh Duong will offset losses from the drop in Binh Duong's long position.| FIT INVEST vs. POST TELECOMMU | FIT INVEST vs. PostTelecommunication Equipment | FIT INVEST vs. Post and Telecommunications | FIT INVEST vs. Saigon Telecommunication Technologies |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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