Correlation Between SMC Investment and Book
Can any of the company-specific risk be diversified away by investing in both SMC Investment and Book 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 Book 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 Book And Educational, you can compare the effects of market volatilities on SMC Investment and Book 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 Book. Check out your portfolio center. Please also check ongoing floating volatility patterns of SMC Investment and Book.
Diversification Opportunities for SMC Investment and Book
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between SMC and Book is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding SMC Investment Trading and Book And Educational in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Book And Educational 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 Book. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Book And Educational has no effect on the direction of SMC Investment i.e., SMC Investment and Book go up and down completely randomly.
Pair Corralation between SMC Investment and Book
Assuming the 90 days trading horizon SMC Investment Trading is expected to under-perform the Book. In addition to that, SMC Investment is 2.1 times more volatile than Book And Educational. It trades about -0.5 of its total potential returns per unit of risk. Book And Educational is currently generating about 0.5 per unit of volatility. If you would invest 1,700,000 in Book And Educational on November 3, 2024 and sell it today you would earn a total of 50,000 from holding Book And Educational or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 22.22% |
| Values | Daily Returns |
SMC Investment Trading vs. Book And Educational
Performance |
| Timeline |
| SMC Investment Trading |
| Book And Educational |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
SMC Investment and Book Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SMC Investment and Book
The main advantage of trading using opposite SMC Investment and Book positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SMC Investment position performs unexpectedly, Book 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 Book will offset losses from the drop in Book's long position.| SMC Investment vs. Hochiminh City Metal | SMC Investment vs. LDG Investment JSC | SMC Investment vs. Tien Giang Investment | SMC Investment vs. MST Investment JSC |
| Book vs. Idico JSC | Book vs. Vietnam Medicinal Materials | Book vs. Hochiminh City Metal | Book vs. Atesco Industrial Cartering |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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