Correlation Between Traeger and FGI Industries
Can any of the company-specific risk be diversified away by investing in both Traeger and FGI Industries 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 Traeger and FGI Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Traeger and FGI Industries, you can compare the effects of market volatilities on Traeger and FGI Industries 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 Traeger with a short position of FGI Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Traeger and FGI Industries.
Diversification Opportunities for Traeger and FGI Industries
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Traeger and FGI is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Traeger and FGI Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FGI Industries and Traeger 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 Traeger are associated (or correlated) with FGI Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FGI Industries has no effect on the direction of Traeger i.e., Traeger and FGI Industries go up and down completely randomly.
Pair Corralation between Traeger and FGI Industries
Given the investment horizon of 90 days Traeger is expected to generate 0.32 times more return on investment than FGI Industries. However, Traeger is 3.15 times less risky than FGI Industries. It trades about -0.02 of its potential returns per unit of risk. FGI Industries is currently generating about -0.01 per unit of risk. If you would invest 303.00 in Traeger on August 24, 2024 and sell it today you would lose (5.00) from holding Traeger or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Traeger vs. FGI Industries
Performance |
| Timeline |
| Traeger |
| FGI Industries |
Traeger and FGI Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Traeger and FGI Industries
The main advantage of trading using opposite Traeger and FGI Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Traeger position performs unexpectedly, FGI Industries 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 FGI Industries will offset losses from the drop in FGI Industries' long position.The idea behind Traeger and FGI Industries pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| FGI Industries vs. Virco Manufacturing | FGI Industries vs. Energy Focu | FGI Industries vs. Hamilton Beach Brands | FGI Industries vs. Natuzzi SpA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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