Correlation Between Din Capital and FPT Digital
Can any of the company-specific risk be diversified away by investing in both Din Capital and FPT Digital 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 Din Capital and FPT Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Din Capital Investment and FPT Digital Retail, you can compare the effects of market volatilities on Din Capital and FPT Digital 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 Din Capital with a short position of FPT Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Din Capital and FPT Digital.
Diversification Opportunities for Din Capital and FPT Digital
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Din and FPT is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Din Capital Investment and FPT Digital Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FPT Digital Retail and Din Capital 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 Din Capital Investment are associated (or correlated) with FPT Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FPT Digital Retail has no effect on the direction of Din Capital i.e., Din Capital and FPT Digital go up and down completely randomly.
Pair Corralation between Din Capital and FPT Digital
Assuming the 90 days trading horizon Din Capital Investment is expected to generate 2.05 times more return on investment than FPT Digital. However, Din Capital is 2.05 times more volatile than FPT Digital Retail. It trades about 0.23 of its potential returns per unit of risk. FPT Digital Retail is currently generating about 0.21 per unit of risk. If you would invest 920,000 in Din Capital Investment on September 2, 2024 and sell it today you would earn a total of 100,000 from holding Din Capital Investment or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Din Capital Investment vs. FPT Digital Retail
Performance |
| Timeline |
| Din Capital Investment |
| FPT Digital Retail |
Din Capital and FPT Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Din Capital and FPT Digital
The main advantage of trading using opposite Din Capital and FPT Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Din Capital position performs unexpectedly, FPT Digital 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 FPT Digital will offset losses from the drop in FPT Digital's long position.| Din Capital vs. FIT INVEST JSC | Din Capital vs. Damsan JSC | Din Capital vs. An Phat Plastic | Din Capital vs. Alphanam ME |
| FPT Digital vs. FIT INVEST JSC | FPT Digital vs. Damsan JSC | FPT Digital vs. An Phat Plastic | FPT Digital vs. Alphanam ME |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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