Correlation Between Uniform Industrial and FIT Holding
Can any of the company-specific risk be diversified away by investing in both Uniform Industrial and FIT Holding 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 Uniform Industrial and FIT Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniform Industrial Corp and FIT Holding Co, you can compare the effects of market volatilities on Uniform Industrial and FIT Holding 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 Uniform Industrial with a short position of FIT Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniform Industrial and FIT Holding.
Diversification Opportunities for Uniform Industrial and FIT Holding
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Uniform and FIT is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Uniform Industrial Corp and FIT Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIT Holding and Uniform Industrial 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 Uniform Industrial Corp are associated (or correlated) with FIT Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIT Holding has no effect on the direction of Uniform Industrial i.e., Uniform Industrial and FIT Holding go up and down completely randomly.
Pair Corralation between Uniform Industrial and FIT Holding
Assuming the 90 days trading horizon Uniform Industrial is expected to generate 55.61 times less return on investment than FIT Holding. In addition to that, Uniform Industrial is 1.16 times more volatile than FIT Holding Co. It trades about 0.0 of its total potential returns per unit of risk. FIT Holding Co is currently generating about 0.08 per unit of volatility. If you would invest 2,617 in FIT Holding Co on October 13, 2024 and sell it today you would earn a total of 3,203 from holding FIT Holding Co or generate 122.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uniform Industrial Corp vs. FIT Holding Co
Performance |
| Timeline |
| Uniform Industrial Corp |
| FIT Holding |
Uniform Industrial and FIT Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniform Industrial and FIT Holding
The main advantage of trading using opposite Uniform Industrial and FIT Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniform Industrial position performs unexpectedly, FIT Holding 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 FIT Holding will offset losses from the drop in FIT Holding's long position.| Uniform Industrial vs. Zinwell | Uniform Industrial vs. Senao International Co | Uniform Industrial vs. AVerMedia Technologies | Uniform Industrial vs. Gigastorage Corp |
| FIT Holding vs. Gigastorage Corp | FIT Holding vs. Shuttle | FIT Holding vs. Yem Chio Co | FIT Holding vs. Walton Advanced Engineering |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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