Correlation Between Innovative Technology and Binhthuan Agriculture
Can any of the company-specific risk be diversified away by investing in both Innovative Technology and Binhthuan Agriculture 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 Innovative Technology and Binhthuan Agriculture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovative Technology Development and Binhthuan Agriculture Services, you can compare the effects of market volatilities on Innovative Technology and Binhthuan Agriculture 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 Innovative Technology with a short position of Binhthuan Agriculture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Technology and Binhthuan Agriculture.
Diversification Opportunities for Innovative Technology and Binhthuan Agriculture
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Innovative and Binhthuan is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Technology Developm and Binhthuan Agriculture Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binhthuan Agriculture and Innovative Technology 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 Innovative Technology Development are associated (or correlated) with Binhthuan Agriculture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binhthuan Agriculture has no effect on the direction of Innovative Technology i.e., Innovative Technology and Binhthuan Agriculture go up and down completely randomly.
Pair Corralation between Innovative Technology and Binhthuan Agriculture
Assuming the 90 days trading horizon Innovative Technology Development is expected to generate 0.97 times more return on investment than Binhthuan Agriculture. However, Innovative Technology Development is 1.03 times less risky than Binhthuan Agriculture. It trades about 0.22 of its potential returns per unit of risk. Binhthuan Agriculture Services is currently generating about -0.23 per unit of risk. If you would invest 1,300,000 in Innovative Technology Development on October 30, 2024 and sell it today you would earn a total of 140,000 from holding Innovative Technology Development or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovative Technology Developm vs. Binhthuan Agriculture Services
Performance |
| Timeline |
| Innovative Technology |
| Binhthuan Agriculture |
Innovative Technology and Binhthuan Agriculture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Technology and Binhthuan Agriculture
The main advantage of trading using opposite Innovative Technology and Binhthuan Agriculture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Technology position performs unexpectedly, Binhthuan Agriculture 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 Binhthuan Agriculture will offset losses from the drop in Binhthuan Agriculture's long position.| Innovative Technology vs. FIT INVEST JSC | Innovative Technology vs. Damsan JSC | Innovative Technology vs. An Phat Plastic | Innovative Technology vs. APG Securities Joint |
| Binhthuan Agriculture vs. Danang Education Investment | Binhthuan Agriculture vs. Vietnam Rubber Group | Binhthuan Agriculture vs. Thong Nhat Rubber | Binhthuan Agriculture vs. Tng Investment And |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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