Correlation Between Firan Technology and Canadian Utilities
Can any of the company-specific risk be diversified away by investing in both Firan Technology and Canadian Utilities 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 Firan Technology and Canadian Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firan Technology Group and Canadian Utilities Limited, you can compare the effects of market volatilities on Firan Technology and Canadian Utilities 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 Firan Technology with a short position of Canadian Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and Canadian Utilities.
Diversification Opportunities for Firan Technology and Canadian Utilities
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Firan and Canadian is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Canadian Utilities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities and Firan Technology 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 Firan Technology Group are associated (or correlated) with Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of Firan Technology i.e., Firan Technology and Canadian Utilities go up and down completely randomly.
Pair Corralation between Firan Technology and Canadian Utilities
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 2.01 times more return on investment than Canadian Utilities. However, Firan Technology is 2.01 times more volatile than Canadian Utilities Limited. It trades about 0.11 of its potential returns per unit of risk. Canadian Utilities Limited is currently generating about 0.05 per unit of risk. If you would invest 298.00 in Firan Technology Group on November 3, 2024 and sell it today you would earn a total of 232.00 from holding Firan Technology Group or generate 77.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Firan Technology Group vs. Canadian Utilities Limited
Performance |
| Timeline |
| Firan Technology |
| Canadian Utilities |
Firan Technology and Canadian Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and Canadian Utilities
The main advantage of trading using opposite Firan Technology and Canadian Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, Canadian Utilities 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 Canadian Utilities will offset losses from the drop in Canadian Utilities' long position.| Firan Technology vs. Infrastrutture Wireless Italiane | Firan Technology vs. Focus Home Interactive | Firan Technology vs. American Homes 4 | Firan Technology vs. HAVERTY FURNITURE A |
| Canadian Utilities vs. SEKISUI CHEMICAL | Canadian Utilities vs. AIR PRODCHEMICALS | Canadian Utilities vs. Silicon Motion Technology | Canadian Utilities vs. TRI CHEMICAL LABORATINC |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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