Correlation Between ADHI KARYA and FIRST SAVINGS
Can any of the company-specific risk be diversified away by investing in both ADHI KARYA and FIRST SAVINGS 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 ADHI KARYA and FIRST SAVINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADHI KARYA and FIRST SAVINGS FINL, you can compare the effects of market volatilities on ADHI KARYA and FIRST SAVINGS 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 ADHI KARYA with a short position of FIRST SAVINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADHI KARYA and FIRST SAVINGS.
Diversification Opportunities for ADHI KARYA and FIRST SAVINGS
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ADHI and FIRST is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding ADHI KARYA and FIRST SAVINGS FINL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRST SAVINGS FINL and ADHI KARYA 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 ADHI KARYA are associated (or correlated) with FIRST SAVINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRST SAVINGS FINL has no effect on the direction of ADHI KARYA i.e., ADHI KARYA and FIRST SAVINGS go up and down completely randomly.
Pair Corralation between ADHI KARYA and FIRST SAVINGS
Assuming the 90 days trading horizon ADHI KARYA is expected to generate 5.41 times more return on investment than FIRST SAVINGS. However, ADHI KARYA is 5.41 times more volatile than FIRST SAVINGS FINL. It trades about 0.12 of its potential returns per unit of risk. FIRST SAVINGS FINL is currently generating about 0.08 per unit of risk. If you would invest 0.50 in ADHI KARYA on November 3, 2024 and sell it today you would earn a total of 0.80 from holding ADHI KARYA or generate 160.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADHI KARYA vs. FIRST SAVINGS FINL
Performance |
| Timeline |
| ADHI KARYA |
| FIRST SAVINGS FINL |
ADHI KARYA and FIRST SAVINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADHI KARYA and FIRST SAVINGS
The main advantage of trading using opposite ADHI KARYA and FIRST SAVINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADHI KARYA position performs unexpectedly, FIRST SAVINGS 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 FIRST SAVINGS will offset losses from the drop in FIRST SAVINGS's long position.| ADHI KARYA vs. ALERION CLEANPOWER | ADHI KARYA vs. Fukuyama Transporting Co | ADHI KARYA vs. Elmos Semiconductor SE | ADHI KARYA vs. DICKS Sporting Goods |
| FIRST SAVINGS vs. POSBO UNSPADRS20YC1 | FIRST SAVINGS vs. Postal Savings Bank | FIRST SAVINGS vs. Oversea Chinese Banking | FIRST SAVINGS vs. UNICREDIT SPA ADR |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |