Correlation Between Firan Technology and DELTA AIR
Can any of the company-specific risk be diversified away by investing in both Firan Technology and DELTA 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 Firan Technology and DELTA AIR 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 DELTA AIR LINES, you can compare the effects of market volatilities on Firan Technology and DELTA 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 Firan Technology with a short position of DELTA AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and DELTA AIR.
Diversification Opportunities for Firan Technology and DELTA AIR
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Firan and DELTA is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and DELTA AIR LINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DELTA AIR LINES 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 DELTA AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DELTA AIR LINES has no effect on the direction of Firan Technology i.e., Firan Technology and DELTA AIR go up and down completely randomly.
Pair Corralation between Firan Technology and DELTA AIR
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 0.92 times more return on investment than DELTA AIR. However, Firan Technology Group is 1.09 times less risky than DELTA AIR. It trades about -0.05 of its potential returns per unit of risk. DELTA AIR LINES is currently generating about -0.05 per unit of risk. If you would invest 488.00 in Firan Technology Group on October 12, 2024 and sell it today you would lose (6.00) from holding Firan Technology Group or give up 1.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 94.44% |
| Values | Daily Returns |
Firan Technology Group vs. DELTA AIR LINES
Performance |
| Timeline |
| Firan Technology |
| DELTA AIR LINES |
Firan Technology and DELTA AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and DELTA AIR
The main advantage of trading using opposite Firan Technology and DELTA AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, DELTA 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 DELTA AIR will offset losses from the drop in DELTA AIR's long position.| Firan Technology vs. MICRONIC MYDATA | Firan Technology vs. NTT DATA | Firan Technology vs. MPH Health Care | Firan Technology vs. China Datang |
| DELTA AIR vs. Ribbon Communications | DELTA AIR vs. Waste Management | DELTA AIR vs. SK TELECOM TDADR | DELTA AIR vs. Zoom Video Communications |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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