Correlation Between Ora Banda and Finexia Financial
Can any of the company-specific risk be diversified away by investing in both Ora Banda and Finexia Financial 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 Ora Banda and Finexia Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ora Banda Mining and Finexia Financial Group, you can compare the effects of market volatilities on Ora Banda and Finexia Financial 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 Ora Banda with a short position of Finexia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ora Banda and Finexia Financial.
Diversification Opportunities for Ora Banda and Finexia Financial
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ora and Finexia is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Ora Banda Mining and Finexia Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finexia Financial and Ora Banda 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 Ora Banda Mining are associated (or correlated) with Finexia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finexia Financial has no effect on the direction of Ora Banda i.e., Ora Banda and Finexia Financial go up and down completely randomly.
Pair Corralation between Ora Banda and Finexia Financial
Assuming the 90 days trading horizon Ora Banda Mining is expected to under-perform the Finexia Financial. In addition to that, Ora Banda is 1.4 times more volatile than Finexia Financial Group. It trades about -0.26 of its total potential returns per unit of risk. Finexia Financial Group is currently generating about 0.26 per unit of volatility. If you would invest 26.00 in Finexia Financial Group on August 30, 2024 and sell it today you would earn a total of 5.00 from holding Finexia Financial Group or generate 19.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ora Banda Mining vs. Finexia Financial Group
Performance |
| Timeline |
| Ora Banda Mining |
| Finexia Financial |
Ora Banda and Finexia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ora Banda and Finexia Financial
The main advantage of trading using opposite Ora Banda and Finexia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ora Banda position performs unexpectedly, Finexia Financial 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 Finexia Financial will offset losses from the drop in Finexia Financial's long position.| Ora Banda vs. Hutchison Telecommunications | Ora Banda vs. Hawsons Iron | Ora Banda vs. Mount Gibson Iron | Ora Banda vs. Platinum Asia Investments |
| Finexia Financial vs. Qbe Insurance Group | Finexia Financial vs. Ora Banda Mining | Finexia Financial vs. Wt Financial Group | Finexia Financial vs. Prime Financial Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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