Correlation Between Firan Technology and SPARTAN STORES
Can any of the company-specific risk be diversified away by investing in both Firan Technology and SPARTAN STORES 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 SPARTAN STORES 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 SPARTAN STORES, you can compare the effects of market volatilities on Firan Technology and SPARTAN STORES 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 SPARTAN STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and SPARTAN STORES.
Diversification Opportunities for Firan Technology and SPARTAN STORES
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Firan and SPARTAN is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and SPARTAN STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPARTAN STORES 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 SPARTAN STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPARTAN STORES has no effect on the direction of Firan Technology i.e., Firan Technology and SPARTAN STORES go up and down completely randomly.
Pair Corralation between Firan Technology and SPARTAN STORES
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 0.77 times more return on investment than SPARTAN STORES. However, Firan Technology Group is 1.29 times less risky than SPARTAN STORES. It trades about 0.13 of its potential returns per unit of risk. SPARTAN STORES is currently generating about -0.05 per unit of risk. If you would invest 480.00 in Firan Technology Group on October 30, 2024 and sell it today you would earn a total of 30.00 from holding Firan Technology Group or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firan Technology Group vs. SPARTAN STORES
Performance |
| Timeline |
| Firan Technology |
| SPARTAN STORES |
Firan Technology and SPARTAN STORES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and SPARTAN STORES
The main advantage of trading using opposite Firan Technology and SPARTAN STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, SPARTAN STORES 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 SPARTAN STORES will offset losses from the drop in SPARTAN STORES's long position.| Firan Technology vs. MidCap Financial Investment | Firan Technology vs. AOYAMA TRADING | Firan Technology vs. MEDCAW INVESTMENTS LS 01 | Firan Technology vs. Guangdong Investment Limited |
| SPARTAN STORES vs. TELECOM ITALIA | SPARTAN STORES vs. Laureate Education | SPARTAN STORES vs. IDP EDUCATION LTD | SPARTAN STORES vs. China Communications Services |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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