Correlation Between Quang Nam and FIT INVEST
Can any of the company-specific risk be diversified away by investing in both Quang Nam and FIT INVEST 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 Quang Nam and FIT INVEST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quang Nam Transportation and FIT INVEST JSC, you can compare the effects of market volatilities on Quang Nam and FIT INVEST 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 Quang Nam with a short position of FIT INVEST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quang Nam and FIT INVEST.
Diversification Opportunities for Quang Nam and FIT INVEST
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Quang and FIT is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Quang Nam Transportation and FIT INVEST JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIT INVEST JSC and Quang Nam 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 Quang Nam Transportation are associated (or correlated) with FIT INVEST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIT INVEST JSC has no effect on the direction of Quang Nam i.e., Quang Nam and FIT INVEST go up and down completely randomly.
Pair Corralation between Quang Nam and FIT INVEST
Assuming the 90 days trading horizon Quang Nam Transportation is expected to generate 2.41 times more return on investment than FIT INVEST. However, Quang Nam is 2.41 times more volatile than FIT INVEST JSC. It trades about 0.06 of its potential returns per unit of risk. FIT INVEST JSC is currently generating about -0.02 per unit of risk. If you would invest 1,130,656 in Quang Nam Transportation on August 31, 2024 and sell it today you would earn a total of 419,344 from holding Quang Nam Transportation or generate 37.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 43.65% |
| Values | Daily Returns |
Quang Nam Transportation vs. FIT INVEST JSC
Performance |
| Timeline |
| Quang Nam Transportation |
| FIT INVEST JSC |
Quang Nam and FIT INVEST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quang Nam and FIT INVEST
The main advantage of trading using opposite Quang Nam and FIT INVEST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quang Nam position performs unexpectedly, FIT INVEST 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 FIT INVEST will offset losses from the drop in FIT INVEST's long position.| Quang Nam vs. FIT INVEST JSC | Quang Nam vs. Damsan JSC | Quang Nam vs. An Phat Plastic | Quang Nam vs. Alphanam ME |
| FIT INVEST vs. Plastic Additives JSC | FIT INVEST vs. Picomat Plastic JSC | FIT INVEST vs. Hanoi Beer Alcohol | FIT INVEST vs. Military Insurance Corp |
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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