Correlation Between MST Investment and Ba Ria
Can any of the company-specific risk be diversified away by investing in both MST Investment and Ba Ria 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 MST Investment and Ba Ria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MST Investment JSC and Ba Ria Thermal, you can compare the effects of market volatilities on MST Investment and Ba Ria 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 MST Investment with a short position of Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of MST Investment and Ba Ria.
Diversification Opportunities for MST Investment and Ba Ria
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MST and BTP is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding MST Investment JSC and Ba Ria Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ba Ria Thermal and MST Investment 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 MST Investment JSC are associated (or correlated) with Ba Ria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ba Ria Thermal has no effect on the direction of MST Investment i.e., MST Investment and Ba Ria go up and down completely randomly.
Pair Corralation between MST Investment and Ba Ria
Assuming the 90 days trading horizon MST Investment JSC is expected to generate 1.84 times more return on investment than Ba Ria. However, MST Investment is 1.84 times more volatile than Ba Ria Thermal. It trades about 0.04 of its potential returns per unit of risk. Ba Ria Thermal is currently generating about 0.02 per unit of risk. If you would invest 409,090 in MST Investment JSC on August 28, 2024 and sell it today you would earn a total of 180,910 from holding MST Investment JSC or generate 44.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
MST Investment JSC vs. Ba Ria Thermal
Performance |
| Timeline |
| MST Investment JSC |
| Ba Ria Thermal |
MST Investment and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MST Investment and Ba Ria
The main advantage of trading using opposite MST Investment and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MST Investment position performs unexpectedly, Ba Ria 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 Ba Ria will offset losses from the drop in Ba Ria's long position.| MST Investment vs. FIT INVEST JSC | MST Investment vs. Damsan JSC | MST Investment vs. An Phat Plastic | MST Investment vs. APG Securities Joint |
| Ba Ria vs. FIT INVEST JSC | Ba Ria vs. Damsan JSC | Ba Ria vs. An Phat Plastic | Ba Ria 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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