Correlation Between Innovative Technology and Vincom Retail
Can any of the company-specific risk be diversified away by investing in both Innovative Technology and Vincom Retail 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 Vincom Retail 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 Vincom Retail JSC, you can compare the effects of market volatilities on Innovative Technology and Vincom Retail 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 Vincom Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Technology and Vincom Retail.
Diversification Opportunities for Innovative Technology and Vincom Retail
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Innovative and Vincom is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Technology Developm and Vincom Retail JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vincom Retail JSC 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 Vincom Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vincom Retail JSC has no effect on the direction of Innovative Technology i.e., Innovative Technology and Vincom Retail go up and down completely randomly.
Pair Corralation between Innovative Technology and Vincom Retail
Assuming the 90 days trading horizon Innovative Technology Development is expected to generate 1.41 times more return on investment than Vincom Retail. However, Innovative Technology is 1.41 times more volatile than Vincom Retail JSC. It trades about -0.09 of its potential returns per unit of risk. Vincom Retail JSC is currently generating about -0.15 per unit of risk. If you would invest 1,390,000 in Innovative Technology Development on September 2, 2024 and sell it today you would lose (70,000) from holding Innovative Technology Development or give up 5.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovative Technology Developm vs. Vincom Retail JSC
Performance |
| Timeline |
| Innovative Technology |
| Vincom Retail JSC |
Innovative Technology and Vincom Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Technology and Vincom Retail
The main advantage of trading using opposite Innovative Technology and Vincom Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Technology position performs unexpectedly, Vincom Retail 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 Vincom Retail will offset losses from the drop in Vincom Retail's long position.| Innovative Technology vs. Saigon Viendong Technology | Innovative Technology vs. Techcom Vietnam REIT | Innovative Technology vs. Sea Air Freight | Innovative Technology vs. Century Synthetic Fiber |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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