Correlation Between FIRST SAVINGS and Altair Engineering
Can any of the company-specific risk be diversified away by investing in both FIRST SAVINGS and Altair Engineering 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 FIRST SAVINGS and Altair Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIRST SAVINGS FINL and Altair Engineering, you can compare the effects of market volatilities on FIRST SAVINGS and Altair Engineering 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 FIRST SAVINGS with a short position of Altair Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST SAVINGS and Altair Engineering.
Diversification Opportunities for FIRST SAVINGS and Altair Engineering
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FIRST and Altair is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding FIRST SAVINGS FINL and Altair Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair Engineering and FIRST SAVINGS 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 FIRST SAVINGS FINL are associated (or correlated) with Altair Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair Engineering has no effect on the direction of FIRST SAVINGS i.e., FIRST SAVINGS and Altair Engineering go up and down completely randomly.
Pair Corralation between FIRST SAVINGS and Altair Engineering
Assuming the 90 days horizon FIRST SAVINGS FINL is expected to under-perform the Altair Engineering. In addition to that, FIRST SAVINGS is 3.52 times more volatile than Altair Engineering. It trades about -0.07 of its total potential returns per unit of risk. Altair Engineering is currently generating about 0.08 per unit of volatility. If you would invest 10,400 in Altair Engineering on October 29, 2024 and sell it today you would earn a total of 100.00 from holding Altair Engineering or generate 0.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
FIRST SAVINGS FINL vs. Altair Engineering
Performance |
| Timeline |
| FIRST SAVINGS FINL |
| Altair Engineering |
FIRST SAVINGS and Altair Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST SAVINGS and Altair Engineering
The main advantage of trading using opposite FIRST SAVINGS and Altair Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST SAVINGS position performs unexpectedly, Altair Engineering 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 Altair Engineering will offset losses from the drop in Altair Engineering's long position.| FIRST SAVINGS vs. Zijin Mining Group | FIRST SAVINGS vs. MUTUIONLINE | FIRST SAVINGS vs. CARSALESCOM | FIRST SAVINGS vs. Lamar Advertising |
| Altair Engineering vs. PENN NATL GAMING | Altair Engineering vs. Games Workshop Group | Altair Engineering vs. FRACTAL GAMING GROUP | Altair Engineering vs. GameStop Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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