Correlation Between Colabor and FLJ
Can any of the company-specific risk be diversified away by investing in both Colabor and FLJ 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 Colabor and FLJ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Colabor Group and FLJ Group, you can compare the effects of market volatilities on Colabor and FLJ 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 Colabor with a short position of FLJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Colabor and FLJ.
Diversification Opportunities for Colabor and FLJ
Excellent diversification
The 3 months correlation between Colabor and FLJ is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Colabor Group and FLJ Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLJ Group and Colabor 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 Colabor Group are associated (or correlated) with FLJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLJ Group has no effect on the direction of Colabor i.e., Colabor and FLJ go up and down completely randomly.
Pair Corralation between Colabor and FLJ
Assuming the 90 days horizon Colabor Group is expected to generate 0.13 times more return on investment than FLJ. However, Colabor Group is 7.89 times less risky than FLJ. It trades about 0.04 of its potential returns per unit of risk. FLJ Group is currently generating about -0.01 per unit of risk. If you would invest 55.00 in Colabor Group on September 3, 2024 and sell it today you would earn a total of 16.00 from holding Colabor Group or generate 29.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 83.23% |
| Values | Daily Returns |
Colabor Group vs. FLJ Group
Performance |
| Timeline |
| Colabor Group |
| FLJ Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Colabor and FLJ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Colabor and FLJ
The main advantage of trading using opposite Colabor and FLJ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Colabor position performs unexpectedly, FLJ 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 FLJ will offset losses from the drop in FLJ's long position.| Colabor vs. Federal National Mortgage | Colabor vs. Shinhan Financial Group | Colabor vs. Woori Financial Group | Colabor vs. Grupo Aval |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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