Correlation Between SMC Investment and Long An
Can any of the company-specific risk be diversified away by investing in both SMC Investment and Long An 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 SMC Investment and Long An into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SMC Investment Trading and Long An Food, you can compare the effects of market volatilities on SMC Investment and Long An 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 SMC Investment with a short position of Long An. Check out your portfolio center. Please also check ongoing floating volatility patterns of SMC Investment and Long An.
Diversification Opportunities for SMC Investment and Long An
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between SMC and Long is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding SMC Investment Trading and Long An Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long An Food and SMC Investment 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 SMC Investment Trading are associated (or correlated) with Long An. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long An Food has no effect on the direction of SMC Investment i.e., SMC Investment and Long An go up and down completely randomly.
Pair Corralation between SMC Investment and Long An
Assuming the 90 days trading horizon SMC Investment Trading is expected to under-perform the Long An. In addition to that, SMC Investment is 1.12 times more volatile than Long An Food. It trades about -0.01 of its total potential returns per unit of risk. Long An Food is currently generating about 0.07 per unit of volatility. If you would invest 1,079,782 in Long An Food on October 25, 2024 and sell it today you would earn a total of 935,218 from holding Long An Food or generate 86.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.73% |
| Values | Daily Returns |
SMC Investment Trading vs. Long An Food
Performance |
| Timeline |
| SMC Investment Trading |
| Long An Food |
SMC Investment and Long An Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SMC Investment and Long An
The main advantage of trading using opposite SMC Investment and Long An positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SMC Investment position performs unexpectedly, Long An 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 Long An will offset losses from the drop in Long An's long position.| SMC Investment vs. FIT INVEST JSC | SMC Investment vs. Damsan JSC | SMC Investment vs. An Phat Plastic | SMC Investment vs. APG Securities Joint |
| Long An vs. Ben Thanh Rubber | Long An vs. Petrovietnam Technical Services | Long An vs. Telecoms Informatics JSC | Long An vs. Southern Rubber Industry |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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