Correlation Between Post and IDJ FINANCIAL
Can any of the company-specific risk be diversified away by investing in both Post and IDJ 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 Post and IDJ FINANCIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Post and Telecommunications and IDJ FINANCIAL, you can compare the effects of market volatilities on Post and IDJ 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 Post with a short position of IDJ FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Post and IDJ FINANCIAL.
Diversification Opportunities for Post and IDJ FINANCIAL
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Post and IDJ is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Post and Telecommunications and IDJ FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDJ FINANCIAL and Post 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 Post and Telecommunications are associated (or correlated) with IDJ FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDJ FINANCIAL has no effect on the direction of Post i.e., Post and IDJ FINANCIAL go up and down completely randomly.
Pair Corralation between Post and IDJ FINANCIAL
Assuming the 90 days trading horizon Post and Telecommunications is expected to under-perform the IDJ FINANCIAL. In addition to that, Post is 1.64 times more volatile than IDJ FINANCIAL. It trades about -0.06 of its total potential returns per unit of risk. IDJ FINANCIAL is currently generating about -0.08 per unit of volatility. If you would invest 620,000 in IDJ FINANCIAL on August 31, 2024 and sell it today you would lose (20,000) from holding IDJ FINANCIAL or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Post and Telecommunications vs. IDJ FINANCIAL
Performance |
| Timeline |
| Post and Telecommuni |
| IDJ FINANCIAL |
Post and IDJ FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Post and IDJ FINANCIAL
The main advantage of trading using opposite Post and IDJ FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Post position performs unexpectedly, IDJ 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 IDJ FINANCIAL will offset losses from the drop in IDJ FINANCIAL's long position.| Post vs. MST Investment JSC | Post vs. Din Capital Investment | Post vs. Petrolimex Information Technology | Post vs. Vina2 Investment and |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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