Correlation Between Ipa Investments and Central Hydropower
Can any of the company-specific risk be diversified away by investing in both Ipa Investments and Central Hydropower 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 Ipa Investments and Central Hydropower into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ipa Investments Group and Central Hydropower JSC, you can compare the effects of market volatilities on Ipa Investments and Central Hydropower 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 Ipa Investments with a short position of Central Hydropower. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ipa Investments and Central Hydropower.
Diversification Opportunities for Ipa Investments and Central Hydropower
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ipa and Central is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Ipa Investments Group and Central Hydropower JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Hydropower JSC and Ipa Investments 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 Ipa Investments Group are associated (or correlated) with Central Hydropower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Hydropower JSC has no effect on the direction of Ipa Investments i.e., Ipa Investments and Central Hydropower go up and down completely randomly.
Pair Corralation between Ipa Investments and Central Hydropower
Assuming the 90 days trading horizon Ipa Investments Group is expected to under-perform the Central Hydropower. In addition to that, Ipa Investments is 2.64 times more volatile than Central Hydropower JSC. It trades about -0.14 of its total potential returns per unit of risk. Central Hydropower JSC is currently generating about 0.06 per unit of volatility. If you would invest 3,285,000 in Central Hydropower JSC on August 27, 2024 and sell it today you would earn a total of 20,000 from holding Central Hydropower JSC or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Ipa Investments Group vs. Central Hydropower JSC
Performance |
| Timeline |
| Ipa Investments Group |
| Central Hydropower JSC |
Ipa Investments and Central Hydropower Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ipa Investments and Central Hydropower
The main advantage of trading using opposite Ipa Investments and Central Hydropower positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ipa Investments position performs unexpectedly, Central Hydropower 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 Central Hydropower will offset losses from the drop in Central Hydropower's long position.| Ipa Investments vs. Sao Vang Rubber | Ipa Investments vs. Foreign Trade Development | Ipa Investments vs. PetroVietnam Drilling Well | Ipa Investments vs. Ducgiang Chemicals Detergent |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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