Correlation Between FIT INVEST and Sea Air
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and Sea Air 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 FIT INVEST and Sea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIT INVEST JSC and Sea Air Freight, you can compare the effects of market volatilities on FIT INVEST and Sea Air 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 FIT INVEST with a short position of Sea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and Sea Air.
Diversification Opportunities for FIT INVEST and Sea Air
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FIT and Sea is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and Sea Air Freight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea Air Freight and FIT INVEST 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 FIT INVEST JSC are associated (or correlated) with Sea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea Air Freight has no effect on the direction of FIT INVEST i.e., FIT INVEST and Sea Air go up and down completely randomly.
Pair Corralation between FIT INVEST and Sea Air
Assuming the 90 days trading horizon FIT INVEST JSC is expected to generate 0.4 times more return on investment than Sea Air. However, FIT INVEST JSC is 2.51 times less risky than Sea Air. It trades about 0.24 of its potential returns per unit of risk. Sea Air Freight is currently generating about -0.04 per unit of risk. If you would invest 403,000 in FIT INVEST JSC on December 4, 2024 and sell it today you would earn a total of 19,000 from holding FIT INVEST JSC or generate 4.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 95.45% |
Values | Daily Returns |
FIT INVEST JSC vs. Sea Air Freight
Performance |
Timeline |
FIT INVEST JSC |
Sea Air Freight |
FIT INVEST and Sea Air Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FIT INVEST and Sea Air
The main advantage of trading using opposite FIT INVEST and Sea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, Sea Air 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 Sea Air will offset losses from the drop in Sea Air's long position.FIT INVEST vs. Vietnam National Reinsurance | FIT INVEST vs. SMC Investment Trading | FIT INVEST vs. Elcom Technology Communications | FIT INVEST vs. Hanoi Beer Alcohol |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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