Correlation Between FinecoBank SpA and Home Depot
Can any of the company-specific risk be diversified away by investing in both FinecoBank SpA and Home Depot 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 FinecoBank SpA and Home Depot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FinecoBank SpA and Home Depot, you can compare the effects of market volatilities on FinecoBank SpA and Home Depot 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 FinecoBank SpA with a short position of Home Depot. Check out your portfolio center. Please also check ongoing floating volatility patterns of FinecoBank SpA and Home Depot.
Diversification Opportunities for FinecoBank SpA and Home Depot
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FinecoBank and Home is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding FinecoBank SpA and Home Depot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Depot and FinecoBank SpA 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 FinecoBank SpA are associated (or correlated) with Home Depot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Depot has no effect on the direction of FinecoBank SpA i.e., FinecoBank SpA and Home Depot go up and down completely randomly.
Pair Corralation between FinecoBank SpA and Home Depot
If you would invest 17,857 in Home Depot on October 30, 2024 and sell it today you would earn a total of 0.00 from holding Home Depot or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 2.56% |
| Values | Daily Returns |
FinecoBank SpA vs. Home Depot
Performance |
| Timeline |
| FinecoBank SpA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Home Depot |
FinecoBank SpA and Home Depot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FinecoBank SpA and Home Depot
The main advantage of trading using opposite FinecoBank SpA and Home Depot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FinecoBank SpA position performs unexpectedly, Home Depot 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 Home Depot will offset losses from the drop in Home Depot's long position.| FinecoBank SpA vs. Spirent Communications plc | FinecoBank SpA vs. Alliance Data Systems | FinecoBank SpA vs. Fidelity National Information | FinecoBank SpA vs. Cellnex Telecom SA |
| Home Depot vs. Capital Drilling | Home Depot vs. Raymond James Financial | Home Depot vs. Compal Electronics GDR | Home Depot vs. Berner Kantonalbank AG |
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 Stocks Directory module to find actively traded stocks across global markets.
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