Correlation Between MST Investment and POST TELECOMMU
Can any of the company-specific risk be diversified away by investing in both MST Investment and POST TELECOMMU 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 POST TELECOMMU 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 POST TELECOMMU, you can compare the effects of market volatilities on MST Investment and POST TELECOMMU 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 POST TELECOMMU. Check out your portfolio center. Please also check ongoing floating volatility patterns of MST Investment and POST TELECOMMU.
Diversification Opportunities for MST Investment and POST TELECOMMU
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MST and POST is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding MST Investment JSC and POST TELECOMMU in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POST TELECOMMU 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 POST TELECOMMU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POST TELECOMMU has no effect on the direction of MST Investment i.e., MST Investment and POST TELECOMMU go up and down completely randomly.
Pair Corralation between MST Investment and POST TELECOMMU
Assuming the 90 days trading horizon MST Investment JSC is expected to generate 1.66 times more return on investment than POST TELECOMMU. However, MST Investment is 1.66 times more volatile than POST TELECOMMU. It trades about 0.13 of its potential returns per unit of risk. POST TELECOMMU is currently generating about -0.26 per unit of risk. If you would invest 680,000 in MST Investment JSC on November 7, 2024 and sell it today you would earn a total of 40,000 from holding MST Investment JSC or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MST Investment JSC vs. POST TELECOMMU
Performance |
| Timeline |
| MST Investment JSC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| POST TELECOMMU |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
MST Investment and POST TELECOMMU Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MST Investment and POST TELECOMMU
The main advantage of trading using opposite MST Investment and POST TELECOMMU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MST Investment position performs unexpectedly, POST TELECOMMU 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 POST TELECOMMU will offset losses from the drop in POST TELECOMMU's long position.| MST Investment vs. HUD1 Investment and | MST Investment vs. Transport and Industry | MST Investment vs. Elcom Technology Communications | MST Investment vs. Binhthuan Agriculture Services |
| POST TELECOMMU vs. Damsan JSC | POST TELECOMMU vs. Binhthuan Agriculture Services | POST TELECOMMU vs. Bentre Aquaproduct Import |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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