Correlation Between POST TELECOMMU and Ba Ria
Can any of the company-specific risk be diversified away by investing in both POST TELECOMMU 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 POST TELECOMMU and Ba Ria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POST TELECOMMU and Ba Ria Thermal, you can compare the effects of market volatilities on POST TELECOMMU 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 POST TELECOMMU with a short position of Ba Ria. Check out your portfolio center. Please also check ongoing floating volatility patterns of POST TELECOMMU and Ba Ria.
Diversification Opportunities for POST TELECOMMU and Ba Ria
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between POST and BTP is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding POST TELECOMMU 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 POST TELECOMMU 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 TELECOMMU 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 POST TELECOMMU i.e., POST TELECOMMU and Ba Ria go up and down completely randomly.
Pair Corralation between POST TELECOMMU and Ba Ria
Assuming the 90 days trading horizon POST TELECOMMU is expected to generate 2.4 times more return on investment than Ba Ria. However, POST TELECOMMU is 2.4 times more volatile than Ba Ria Thermal. It trades about 0.02 of its potential returns per unit of risk. Ba Ria Thermal is currently generating about 0.04 per unit of risk. If you would invest 2,099,998 in POST TELECOMMU on December 1, 2024 and sell it today you would earn a total of 180,002 from holding POST TELECOMMU or generate 8.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 87.3% |
| Values | Daily Returns |
POST TELECOMMU vs. Ba Ria Thermal
Performance |
| Timeline |
| POST TELECOMMU |
| Ba Ria Thermal |
POST TELECOMMU and Ba Ria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POST TELECOMMU and Ba Ria
The main advantage of trading using opposite POST TELECOMMU and Ba Ria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POST TELECOMMU 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.| POST TELECOMMU vs. Fecon Mining JSC | POST TELECOMMU vs. Vietnam Petroleum Transport | POST TELECOMMU vs. PVI Reinsurance Corp | POST TELECOMMU vs. Sao Ta Foods |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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