Correlation Between Alcoa Corp and FG Group
Can any of the company-specific risk be diversified away by investing in both Alcoa Corp and FG Group 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 Alcoa Corp and FG Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alcoa Corp and FG Group Holdings, you can compare the effects of market volatilities on Alcoa Corp and FG Group 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 Alcoa Corp with a short position of FG Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcoa Corp and FG Group.
Diversification Opportunities for Alcoa Corp and FG Group
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alcoa and FGH is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp and FG Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FG Group Holdings and Alcoa Corp 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 Alcoa Corp are associated (or correlated) with FG Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FG Group Holdings has no effect on the direction of Alcoa Corp i.e., Alcoa Corp and FG Group go up and down completely randomly.
Pair Corralation between Alcoa Corp and FG Group
If you would invest 4,073 in Alcoa Corp on September 4, 2024 and sell it today you would earn a total of 497.00 from holding Alcoa Corp or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Alcoa Corp vs. FG Group Holdings
Performance |
| Timeline |
| Alcoa Corp |
| FG Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Alcoa Corp and FG Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcoa Corp and FG Group
The main advantage of trading using opposite Alcoa Corp and FG Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcoa Corp position performs unexpectedly, FG Group 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 FG Group will offset losses from the drop in FG Group's long position.| Alcoa Corp vs. Constellium Nv | Alcoa Corp vs. Century Aluminum | Alcoa Corp vs. China Hongqiao Group | Alcoa Corp vs. Kaiser Aluminum |
| FG Group vs. OneSpaWorld Holdings | FG Group vs. Games Workshop Group | FG Group vs. Johnson Outdoors | FG Group vs. American Outdoor Brands |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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