Correlation Between Military Insurance and Mekong Fisheries
Can any of the company-specific risk be diversified away by investing in both Military Insurance and Mekong Fisheries 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 Military Insurance and Mekong Fisheries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Military Insurance Corp and Mekong Fisheries JSC, you can compare the effects of market volatilities on Military Insurance and Mekong Fisheries 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 Military Insurance with a short position of Mekong Fisheries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Military Insurance and Mekong Fisheries.
Diversification Opportunities for Military Insurance and Mekong Fisheries
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Military and Mekong is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Military Insurance Corp and Mekong Fisheries JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mekong Fisheries JSC and Military Insurance 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 Military Insurance Corp are associated (or correlated) with Mekong Fisheries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mekong Fisheries JSC has no effect on the direction of Military Insurance i.e., Military Insurance and Mekong Fisheries go up and down completely randomly.
Pair Corralation between Military Insurance and Mekong Fisheries
Assuming the 90 days trading horizon Military Insurance Corp is expected to generate 0.93 times more return on investment than Mekong Fisheries. However, Military Insurance Corp is 1.08 times less risky than Mekong Fisheries. It trades about 0.02 of its potential returns per unit of risk. Mekong Fisheries JSC is currently generating about -0.03 per unit of risk. If you would invest 1,534,575 in Military Insurance Corp on October 16, 2024 and sell it today you would earn a total of 135,425 from holding Military Insurance Corp or generate 8.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.99% |
| Values | Daily Returns |
Military Insurance Corp vs. Mekong Fisheries JSC
Performance |
| Timeline |
| Military Insurance Corp |
| Mekong Fisheries JSC |
Military Insurance and Mekong Fisheries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Military Insurance and Mekong Fisheries
The main advantage of trading using opposite Military Insurance and Mekong Fisheries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Military Insurance position performs unexpectedly, Mekong Fisheries 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 Mekong Fisheries will offset losses from the drop in Mekong Fisheries' long position.| Military Insurance vs. Hochiminh City Metal | Military Insurance vs. HUD1 Investment and | Military Insurance vs. Thanh Dat Investment | Military Insurance vs. Saigon Telecommunication Technologies |
| Mekong Fisheries vs. Fecon Mining JSC | Mekong Fisheries vs. Thanh Dat Investment | Mekong Fisheries vs. Military Insurance Corp | Mekong Fisheries vs. CEO Group JSC |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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