Correlation Between FinecoBank SpA and Adriatic Metals
Can any of the company-specific risk be diversified away by investing in both FinecoBank SpA and Adriatic Metals 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 Adriatic Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FinecoBank SpA and Adriatic Metals, you can compare the effects of market volatilities on FinecoBank SpA and Adriatic Metals 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 Adriatic Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of FinecoBank SpA and Adriatic Metals.
Diversification Opportunities for FinecoBank SpA and Adriatic Metals
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FinecoBank and Adriatic is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding FinecoBank SpA and Adriatic Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adriatic Metals 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 Adriatic Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adriatic Metals has no effect on the direction of FinecoBank SpA i.e., FinecoBank SpA and Adriatic Metals go up and down completely randomly.
Pair Corralation between FinecoBank SpA and Adriatic Metals
Assuming the 90 days trading horizon FinecoBank SpA is expected to generate 1.12 times less return on investment than Adriatic Metals. But when comparing it to its historical volatility, FinecoBank SpA is 1.54 times less risky than Adriatic Metals. It trades about 0.03 of its potential returns per unit of risk. Adriatic Metals is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 18,460 in Adriatic Metals on October 16, 2024 and sell it today you would earn a total of 1,640 from holding Adriatic Metals or generate 8.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FinecoBank SpA vs. Adriatic Metals
Performance |
| Timeline |
| FinecoBank SpA |
| Adriatic Metals |
FinecoBank SpA and Adriatic Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FinecoBank SpA and Adriatic Metals
The main advantage of trading using opposite FinecoBank SpA and Adriatic Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FinecoBank SpA position performs unexpectedly, Adriatic Metals 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 Adriatic Metals will offset losses from the drop in Adriatic Metals' long position.| FinecoBank SpA vs. Jacquet Metal Service | FinecoBank SpA vs. Europa Metals | FinecoBank SpA vs. GreenX Metals | FinecoBank SpA vs. Cornish Metals |
| Adriatic Metals vs. Auto Trader Group | Adriatic Metals vs. FinecoBank SpA | Adriatic Metals vs. Cembra Money Bank | Adriatic Metals vs. Sydbank |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |