Correlation Between Innovative Technology and Ha Long
Can any of the company-specific risk be diversified away by investing in both Innovative Technology and Ha Long 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 Ha Long 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 Ha Long Investment, you can compare the effects of market volatilities on Innovative Technology and Ha Long 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 Ha Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Technology and Ha Long.
Diversification Opportunities for Innovative Technology and Ha Long
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Innovative and HID is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Technology Developm and Ha Long Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ha Long Investment 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 Ha Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ha Long Investment has no effect on the direction of Innovative Technology i.e., Innovative Technology and Ha Long go up and down completely randomly.
Pair Corralation between Innovative Technology and Ha Long
Assuming the 90 days trading horizon Innovative Technology Development is expected to under-perform the Ha Long. In addition to that, Innovative Technology is 3.61 times more volatile than Ha Long Investment. It trades about -0.13 of its total potential returns per unit of risk. Ha Long Investment is currently generating about -0.27 per unit of volatility. If you would invest 274,000 in Ha Long Investment on August 29, 2024 and sell it today you would lose (10,000) from holding Ha Long Investment or give up 3.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovative Technology Developm vs. Ha Long Investment
Performance |
| Timeline |
| Innovative Technology |
| Ha Long Investment |
Innovative Technology and Ha Long Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Technology and Ha Long
The main advantage of trading using opposite Innovative Technology and Ha Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Technology position performs unexpectedly, Ha Long 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 Ha Long will offset losses from the drop in Ha Long'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 |
| Ha Long vs. FIT INVEST JSC | Ha Long vs. Damsan JSC | Ha Long vs. An Phat Plastic | Ha Long vs. APG Securities Joint |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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