Correlation Between HVC Investment and FIT INVEST
Can any of the company-specific risk be diversified away by investing in both HVC Investment and FIT INVEST 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 HVC Investment and FIT INVEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HVC Investment and and FIT INVEST JSC, you can compare the effects of market volatilities on HVC Investment and FIT INVEST 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 HVC Investment with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of HVC Investment and FIT INVEST.
Diversification Opportunities for HVC Investment and FIT INVEST
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HVC and FIT is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding HVC Investment and and FIT INVEST JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIT INVEST JSC and HVC Investment 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 HVC Investment and are associated (or correlated) with FIT INVEST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIT INVEST JSC has no effect on the direction of HVC Investment i.e., HVC Investment and FIT INVEST go up and down completely randomly.
Pair Corralation between HVC Investment and FIT INVEST
Assuming the 90 days trading horizon HVC Investment and is expected to generate 3.95 times more return on investment than FIT INVEST. However, HVC Investment is 3.95 times more volatile than FIT INVEST JSC. It trades about -0.07 of its potential returns per unit of risk. FIT INVEST JSC is currently generating about -0.31 per unit of risk. If you would invest 967,000 in HVC Investment and on November 3, 2024 and sell it today you would lose (41,000) from holding HVC Investment and or give up 4.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HVC Investment and vs. FIT INVEST JSC
Performance |
| Timeline |
| HVC Investment |
| FIT INVEST JSC |
HVC Investment and FIT INVEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HVC Investment and FIT INVEST
The main advantage of trading using opposite HVC Investment and FIT INVEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HVC Investment position performs unexpectedly, FIT INVEST 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 FIT INVEST will offset losses from the drop in FIT INVEST's long position.| HVC Investment vs. Tng Investment And | HVC Investment vs. Bao Ngoc Investment | HVC Investment vs. Sea Air Freight | HVC Investment vs. Taseco Air Services |
| FIT INVEST vs. Nafoods Group JSC | FIT INVEST vs. Dong A Hotel | FIT INVEST vs. Military Insurance Corp | FIT INVEST vs. Vietnam Airlines 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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