Correlation Between REVO INSURANCE and FIH MOBILE
Can any of the company-specific risk be diversified away by investing in both REVO INSURANCE and FIH MOBILE 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 REVO INSURANCE and FIH MOBILE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REVO INSURANCE SPA and FIH MOBILE, you can compare the effects of market volatilities on REVO INSURANCE and FIH MOBILE 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 REVO INSURANCE with a short position of FIH MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of REVO INSURANCE and FIH MOBILE.
Diversification Opportunities for REVO INSURANCE and FIH MOBILE
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between REVO and FIH is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding REVO INSURANCE SPA and FIH MOBILE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIH MOBILE and REVO INSURANCE 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 REVO INSURANCE SPA are associated (or correlated) with FIH MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIH MOBILE has no effect on the direction of REVO INSURANCE i.e., REVO INSURANCE and FIH MOBILE go up and down completely randomly.
Pair Corralation between REVO INSURANCE and FIH MOBILE
Assuming the 90 days horizon REVO INSURANCE SPA is expected to generate 0.59 times more return on investment than FIH MOBILE. However, REVO INSURANCE SPA is 1.69 times less risky than FIH MOBILE. It trades about -0.21 of its potential returns per unit of risk. FIH MOBILE is currently generating about -0.21 per unit of risk. If you would invest 1,300 in REVO INSURANCE SPA on November 3, 2024 and sell it today you would lose (165.00) from holding REVO INSURANCE SPA or give up 12.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
REVO INSURANCE SPA vs. FIH MOBILE
Performance |
| Timeline |
| REVO INSURANCE SPA |
| FIH MOBILE |
REVO INSURANCE and FIH MOBILE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REVO INSURANCE and FIH MOBILE
The main advantage of trading using opposite REVO INSURANCE and FIH MOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REVO INSURANCE position performs unexpectedly, FIH MOBILE 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 FIH MOBILE will offset losses from the drop in FIH MOBILE's long position.| REVO INSURANCE vs. BlueScope Steel Limited | REVO INSURANCE vs. Olympic Steel | REVO INSURANCE vs. WILLIS LEASE FIN | REVO INSURANCE vs. GRENKELEASING Dusseldorf |
| FIH MOBILE vs. SIVERS SEMICONDUCTORS AB | FIH MOBILE vs. NorAm Drilling AS | FIH MOBILE vs. Volkswagen AG | FIH MOBILE vs. Darden Restaurants |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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