Correlation Between IDJ FINANCIAL and Binh Duong
Can any of the company-specific risk be diversified away by investing in both IDJ FINANCIAL 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 IDJ FINANCIAL and Binh Duong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IDJ FINANCIAL and Binh Duong Construction, you can compare the effects of market volatilities on IDJ FINANCIAL 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 IDJ FINANCIAL with a short position of Binh Duong. Check out your portfolio center. Please also check ongoing floating volatility patterns of IDJ FINANCIAL and Binh Duong.
Diversification Opportunities for IDJ FINANCIAL and Binh Duong
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IDJ and Binh is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding IDJ FINANCIAL and Binh Duong Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binh Duong Construction and IDJ FINANCIAL 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 IDJ FINANCIAL 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 Construction has no effect on the direction of IDJ FINANCIAL i.e., IDJ FINANCIAL and Binh Duong go up and down completely randomly.
Pair Corralation between IDJ FINANCIAL and Binh Duong
Assuming the 90 days trading horizon IDJ FINANCIAL is expected to generate 9.36 times less return on investment than Binh Duong. In addition to that, IDJ FINANCIAL is 1.26 times more volatile than Binh Duong Construction. It trades about 0.05 of its total potential returns per unit of risk. Binh Duong Construction is currently generating about 0.54 per unit of volatility. If you would invest 612,000 in Binh Duong Construction on September 13, 2024 and sell it today you would earn a total of 125,000 from holding Binh Duong Construction or generate 20.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IDJ FINANCIAL vs. Binh Duong Construction
Performance |
| Timeline |
| IDJ FINANCIAL |
| Binh Duong Construction |
IDJ FINANCIAL and Binh Duong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IDJ FINANCIAL and Binh Duong
The main advantage of trading using opposite IDJ FINANCIAL and Binh Duong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IDJ FINANCIAL 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.| IDJ FINANCIAL vs. FIT INVEST JSC | IDJ FINANCIAL vs. Damsan JSC | IDJ FINANCIAL vs. An Phat Plastic | IDJ FINANCIAL vs. Alphanam ME |
| Binh Duong vs. FIT INVEST JSC | Binh Duong vs. Damsan JSC | Binh Duong vs. An Phat Plastic | Binh Duong 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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