Correlation Between VARIOUS EATERIES and Firan Technology
Can any of the company-specific risk be diversified away by investing in both VARIOUS EATERIES and Firan Technology 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 VARIOUS EATERIES and Firan Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VARIOUS EATERIES LS and Firan Technology Group, you can compare the effects of market volatilities on VARIOUS EATERIES and Firan Technology 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 VARIOUS EATERIES with a short position of Firan Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of VARIOUS EATERIES and Firan Technology.
Diversification Opportunities for VARIOUS EATERIES and Firan Technology
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VARIOUS and Firan is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding VARIOUS EATERIES LS and Firan Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firan Technology and VARIOUS EATERIES 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 VARIOUS EATERIES LS are associated (or correlated) with Firan Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firan Technology has no effect on the direction of VARIOUS EATERIES i.e., VARIOUS EATERIES and Firan Technology go up and down completely randomly.
Pair Corralation between VARIOUS EATERIES and Firan Technology
Assuming the 90 days horizon VARIOUS EATERIES LS is expected to under-perform the Firan Technology. In addition to that, VARIOUS EATERIES is 1.33 times more volatile than Firan Technology Group. It trades about -0.34 of its total potential returns per unit of risk. Firan Technology Group is currently generating about -0.05 per unit of volatility. 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 Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
VARIOUS EATERIES LS vs. Firan Technology Group
Performance |
| Timeline |
| VARIOUS EATERIES |
| Firan Technology |
VARIOUS EATERIES and Firan Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VARIOUS EATERIES and Firan Technology
The main advantage of trading using opposite VARIOUS EATERIES and Firan Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VARIOUS EATERIES position performs unexpectedly, Firan Technology 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 Firan Technology will offset losses from the drop in Firan Technology's long position.| VARIOUS EATERIES vs. Gaming and Leisure | VARIOUS EATERIES vs. RETAIL FOOD GROUP | VARIOUS EATERIES vs. USWE SPORTS AB | VARIOUS EATERIES vs. Playa Hotels Resorts |
| Firan Technology vs. MICRONIC MYDATA | Firan Technology vs. NTT DATA | Firan Technology vs. MPH Health Care | Firan Technology vs. China Datang |
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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