Correlation Between Cars and FUJITSU
Can any of the company-specific risk be diversified away by investing in both Cars and FUJITSU 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 Cars and FUJITSU into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cars Inc and FUJITSU LTD ADR, you can compare the effects of market volatilities on Cars and FUJITSU 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 Cars with a short position of FUJITSU. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cars and FUJITSU.
Diversification Opportunities for Cars and FUJITSU
Very good diversification
The 3 months correlation between Cars and FUJITSU is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Cars Inc and FUJITSU LTD ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUJITSU LTD ADR and Cars 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 Cars Inc are associated (or correlated) with FUJITSU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUJITSU LTD ADR has no effect on the direction of Cars i.e., Cars and FUJITSU go up and down completely randomly.
Pair Corralation between Cars and FUJITSU
Assuming the 90 days horizon Cars Inc is expected to under-perform the FUJITSU. In addition to that, Cars is 1.23 times more volatile than FUJITSU LTD ADR. It trades about -0.01 of its total potential returns per unit of risk. FUJITSU LTD ADR is currently generating about 0.09 per unit of volatility. If you would invest 1,680 in FUJITSU LTD ADR on September 13, 2024 and sell it today you would earn a total of 50.00 from holding FUJITSU LTD ADR or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cars Inc vs. FUJITSU LTD ADR
Performance |
| Timeline |
| Cars Inc |
| FUJITSU LTD ADR |
Cars and FUJITSU Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cars and FUJITSU
The main advantage of trading using opposite Cars and FUJITSU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cars position performs unexpectedly, FUJITSU 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 FUJITSU will offset losses from the drop in FUJITSU's long position.| Cars vs. Superior Plus Corp | Cars vs. SIVERS SEMICONDUCTORS AB | Cars vs. Norsk Hydro ASA | Cars vs. Reliance Steel Aluminum |
| FUJITSU vs. China Communications Services | FUJITSU vs. CITIC Telecom International | FUJITSU vs. Jacquet Metal Service | FUJITSU vs. Consolidated Communications Holdings |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stocks Directory Find actively traded stocks across global markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |