Correlation Between FIRST SAVINGS and VELA TECHNOLPLC
Can any of the company-specific risk be diversified away by investing in both FIRST SAVINGS and VELA TECHNOLPLC 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 VELA TECHNOLPLC 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 VELA TECHNOLPLC LS 0001, you can compare the effects of market volatilities on FIRST SAVINGS and VELA TECHNOLPLC 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 VELA TECHNOLPLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST SAVINGS and VELA TECHNOLPLC.
Diversification Opportunities for FIRST SAVINGS and VELA TECHNOLPLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FIRST and VELA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FIRST SAVINGS FINL and VELA TECHNOLPLC LS 0001 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VELA TECHNOLPLC LS 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 VELA TECHNOLPLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VELA TECHNOLPLC LS has no effect on the direction of FIRST SAVINGS i.e., FIRST SAVINGS and VELA TECHNOLPLC go up and down completely randomly.
Pair Corralation between FIRST SAVINGS and VELA TECHNOLPLC
Assuming the 90 days horizon FIRST SAVINGS is expected to generate 7.52 times less return on investment than VELA TECHNOLPLC. But when comparing it to its historical volatility, FIRST SAVINGS FINL is 8.46 times less risky than VELA TECHNOLPLC. It trades about 0.04 of its potential returns per unit of risk. VELA TECHNOLPLC LS 0001 is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 0.03 in VELA TECHNOLPLC LS 0001 on October 24, 2024 and sell it today you would earn a total of 0.02 from holding VELA TECHNOLPLC LS 0001 or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
FIRST SAVINGS FINL vs. VELA TECHNOLPLC LS 0001
Performance |
| Timeline |
| FIRST SAVINGS FINL |
| VELA TECHNOLPLC LS |
FIRST SAVINGS and VELA TECHNOLPLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST SAVINGS and VELA TECHNOLPLC
The main advantage of trading using opposite FIRST SAVINGS and VELA TECHNOLPLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST SAVINGS position performs unexpectedly, VELA TECHNOLPLC 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 VELA TECHNOLPLC will offset losses from the drop in VELA TECHNOLPLC's long position.| FIRST SAVINGS vs. SCANSOURCE | FIRST SAVINGS vs. HUTCHISON TELECOMM | FIRST SAVINGS vs. SILVER BULLET DATA | FIRST SAVINGS vs. Canadian Utilities Limited |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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