Correlation Between FATFISH GROUP and Gerresheimer
Can any of the company-specific risk be diversified away by investing in both FATFISH GROUP and Gerresheimer 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 FATFISH GROUP and Gerresheimer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FATFISH GROUP LTD and Gerresheimer AG, you can compare the effects of market volatilities on FATFISH GROUP and Gerresheimer 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 FATFISH GROUP with a short position of Gerresheimer. Check out your portfolio center. Please also check ongoing floating volatility patterns of FATFISH GROUP and Gerresheimer.
Diversification Opportunities for FATFISH GROUP and Gerresheimer
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FATFISH and Gerresheimer is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding FATFISH GROUP LTD and Gerresheimer AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gerresheimer AG and FATFISH GROUP 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 FATFISH GROUP LTD are associated (or correlated) with Gerresheimer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gerresheimer AG has no effect on the direction of FATFISH GROUP i.e., FATFISH GROUP and Gerresheimer go up and down completely randomly.
Pair Corralation between FATFISH GROUP and Gerresheimer
Assuming the 90 days horizon FATFISH GROUP LTD is expected to generate 7.12 times more return on investment than Gerresheimer. However, FATFISH GROUP is 7.12 times more volatile than Gerresheimer AG. It trades about 0.13 of its potential returns per unit of risk. Gerresheimer AG is currently generating about -0.11 per unit of risk. If you would invest 0.45 in FATFISH GROUP LTD on September 2, 2024 and sell it today you would earn a total of 0.10 from holding FATFISH GROUP LTD or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FATFISH GROUP LTD vs. Gerresheimer AG
Performance |
| Timeline |
| FATFISH GROUP LTD |
| Gerresheimer AG |
FATFISH GROUP and Gerresheimer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FATFISH GROUP and Gerresheimer
The main advantage of trading using opposite FATFISH GROUP and Gerresheimer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FATFISH GROUP position performs unexpectedly, Gerresheimer 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 Gerresheimer will offset losses from the drop in Gerresheimer's long position.| FATFISH GROUP vs. Morgan Stanley | FATFISH GROUP vs. The Goldman Sachs | FATFISH GROUP vs. Superior Plus Corp | FATFISH GROUP vs. NMI Holdings |
| Gerresheimer vs. ESSILORLUXOTTICA 12ON | Gerresheimer vs. Intuitive Surgical | Gerresheimer vs. EssilorLuxottica Socit anonyme | Gerresheimer vs. HOYA Corporation |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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