Correlation Between SVI Public and Hydrotek Public
Can any of the company-specific risk be diversified away by investing in both SVI Public and Hydrotek Public 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 SVI Public and Hydrotek Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SVI Public and Hydrotek Public, you can compare the effects of market volatilities on SVI Public and Hydrotek Public 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 SVI Public with a short position of Hydrotek Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of SVI Public and Hydrotek Public.
Diversification Opportunities for SVI Public and Hydrotek Public
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SVI and Hydrotek is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding SVI Public and Hydrotek Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydrotek Public and SVI Public 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 SVI Public are associated (or correlated) with Hydrotek Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydrotek Public has no effect on the direction of SVI Public i.e., SVI Public and Hydrotek Public go up and down completely randomly.
Pair Corralation between SVI Public and Hydrotek Public
Assuming the 90 days trading horizon SVI Public is expected to generate 9.46 times more return on investment than Hydrotek Public. However, SVI Public is 9.46 times more volatile than Hydrotek Public. It trades about 0.06 of its potential returns per unit of risk. Hydrotek Public is currently generating about 0.0 per unit of risk. If you would invest 691.00 in SVI Public on September 5, 2024 and sell it today you would earn a total of 74.00 from holding SVI Public or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SVI Public vs. Hydrotek Public
Performance |
| Timeline |
| SVI Public |
| Hydrotek Public |
SVI Public and Hydrotek Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SVI Public and Hydrotek Public
The main advantage of trading using opposite SVI Public and Hydrotek Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SVI Public position performs unexpectedly, Hydrotek Public 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 Hydrotek Public will offset losses from the drop in Hydrotek Public's long position.| SVI Public vs. KCE Electronics Public | SVI Public vs. Land and Houses | SVI Public vs. The Siam Cement | SVI Public vs. Bangkok Bank Public |
| Hydrotek Public vs. Internet Thailand Public | Hydrotek Public vs. Cho Thavee Public | Hydrotek Public vs. E for L | Hydrotek Public vs. Grande Asset Hotels |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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