Correlation Between FPT Digital and SMC Investment
Can any of the company-specific risk be diversified away by investing in both FPT Digital and SMC Investment 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 FPT Digital and SMC Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FPT Digital Retail and SMC Investment Trading, you can compare the effects of market volatilities on FPT Digital and SMC Investment 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 FPT Digital with a short position of SMC Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of FPT Digital and SMC Investment.
Diversification Opportunities for FPT Digital and SMC Investment
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FPT and SMC is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding FPT Digital Retail and SMC Investment Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMC Investment Trading and FPT Digital 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 FPT Digital Retail are associated (or correlated) with SMC Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMC Investment Trading has no effect on the direction of FPT Digital i.e., FPT Digital and SMC Investment go up and down completely randomly.
Pair Corralation between FPT Digital and SMC Investment
Assuming the 90 days trading horizon FPT Digital Retail is expected to generate 0.36 times more return on investment than SMC Investment. However, FPT Digital Retail is 2.77 times less risky than SMC Investment. It trades about 0.4 of its potential returns per unit of risk. SMC Investment Trading is currently generating about -0.22 per unit of risk. If you would invest 18,260,000 in FPT Digital Retail on October 25, 2024 and sell it today you would earn a total of 1,840,000 from holding FPT Digital Retail or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FPT Digital Retail vs. SMC Investment Trading
Performance |
| Timeline |
| FPT Digital Retail |
| SMC Investment Trading |
FPT Digital and SMC Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FPT Digital and SMC Investment
The main advantage of trading using opposite FPT Digital and SMC Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FPT Digital position performs unexpectedly, SMC Investment 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 SMC Investment will offset losses from the drop in SMC Investment's long position.| FPT Digital vs. FIT INVEST JSC | FPT Digital vs. Damsan JSC | FPT Digital vs. An Phat Plastic | FPT Digital vs. APG Securities Joint |
| SMC Investment vs. Dinhvu Port Investment | SMC Investment vs. Elcom Technology Communications | SMC Investment vs. Japan Vietnam Medical | SMC Investment vs. Vinhomes JSC |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |