Correlation Between Cisco Systems and FEDEX
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By analyzing existing cross correlation between Cisco Systems and FEDEX P 405, you can compare the effects of market volatilities on Cisco Systems and FEDEX 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 Cisco Systems with a short position of FEDEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and FEDEX.
Diversification Opportunities for Cisco Systems and FEDEX
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cisco and FEDEX is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and FEDEX P 405 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FEDEX P 405 and Cisco Systems 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 Cisco Systems are associated (or correlated) with FEDEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FEDEX P 405 has no effect on the direction of Cisco Systems i.e., Cisco Systems and FEDEX go up and down completely randomly.
Pair Corralation between Cisco Systems and FEDEX
Given the investment horizon of 90 days Cisco Systems is expected to generate 1.01 times more return on investment than FEDEX. However, Cisco Systems is 1.01 times more volatile than FEDEX P 405. It trades about 0.17 of its potential returns per unit of risk. FEDEX P 405 is currently generating about -0.03 per unit of risk. If you would invest 4,590 in Cisco Systems on September 1, 2024 and sell it today you would earn a total of 1,331 from holding Cisco Systems or generate 29.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.03% |
| Values | Daily Returns |
Cisco Systems vs. FEDEX P 405
Performance |
| Timeline |
| Cisco Systems |
| FEDEX P 405 |
Cisco Systems and FEDEX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and FEDEX
The main advantage of trading using opposite Cisco Systems and FEDEX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, FEDEX 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 FEDEX will offset losses from the drop in FEDEX's long position.| Cisco Systems vs. Comtech Telecommunications Corp | Cisco Systems vs. KVH Industries | Cisco Systems vs. Silicom | Cisco Systems vs. Knowles Cor |
| FEDEX vs. Chipotle Mexican Grill | FEDEX vs. Dennys Corp | FEDEX vs. Weibo Corp | FEDEX vs. The Cheesecake Factory |
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 Stocks Directory module to find actively traded stocks across global markets.
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