Correlation Between Federal Agricultural and Cleanaway Waste
Can any of the company-specific risk be diversified away by investing in both Federal Agricultural and Cleanaway Waste 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 Federal Agricultural and Cleanaway Waste into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal Agricultural Mortgage and Cleanaway Waste Management, you can compare the effects of market volatilities on Federal Agricultural and Cleanaway Waste 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 Federal Agricultural with a short position of Cleanaway Waste. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Agricultural and Cleanaway Waste.
Diversification Opportunities for Federal Agricultural and Cleanaway Waste
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Federal and Cleanaway is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Federal Agricultural Mortgage and Cleanaway Waste Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cleanaway Waste Mana and Federal Agricultural 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 Federal Agricultural Mortgage are associated (or correlated) with Cleanaway Waste. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cleanaway Waste Mana has no effect on the direction of Federal Agricultural i.e., Federal Agricultural and Cleanaway Waste go up and down completely randomly.
Pair Corralation between Federal Agricultural and Cleanaway Waste
Assuming the 90 days horizon Federal Agricultural Mortgage is expected to generate 1.17 times more return on investment than Cleanaway Waste. However, Federal Agricultural is 1.17 times more volatile than Cleanaway Waste Management. It trades about 0.06 of its potential returns per unit of risk. Cleanaway Waste Management is currently generating about 0.01 per unit of risk. If you would invest 10,412 in Federal Agricultural Mortgage on October 13, 2024 and sell it today you would earn a total of 7,688 from holding Federal Agricultural Mortgage or generate 73.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federal Agricultural Mortgage vs. Cleanaway Waste Management
Performance |
| Timeline |
| Federal Agricultural |
| Cleanaway Waste Mana |
Federal Agricultural and Cleanaway Waste Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Agricultural and Cleanaway Waste
The main advantage of trading using opposite Federal Agricultural and Cleanaway Waste positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Agricultural position performs unexpectedly, Cleanaway Waste 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 Cleanaway Waste will offset losses from the drop in Cleanaway Waste's long position.| Federal Agricultural vs. Calibre Mining Corp | Federal Agricultural vs. ARDAGH METAL PACDL 0001 | Federal Agricultural vs. GREENX METALS LTD | Federal Agricultural vs. Stag Industrial |
| Cleanaway Waste vs. Playmates Toys Limited | Cleanaway Waste vs. PLAYTECH | Cleanaway Waste vs. DENTSPLY SIRONA | Cleanaway Waste vs. ANGANG STEEL H |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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