Correlation Between Dana and Foresight Autonomous
Can any of the company-specific risk be diversified away by investing in both Dana and Foresight Autonomous 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 Dana and Foresight Autonomous into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Inc and Foresight Autonomous Holdings, you can compare the effects of market volatilities on Dana and Foresight Autonomous 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 Dana with a short position of Foresight Autonomous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana and Foresight Autonomous.
Diversification Opportunities for Dana and Foresight Autonomous
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dana and Foresight is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dana Inc and Foresight Autonomous Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foresight Autonomous and Dana 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 Dana Inc are associated (or correlated) with Foresight Autonomous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foresight Autonomous has no effect on the direction of Dana i.e., Dana and Foresight Autonomous go up and down completely randomly.
Pair Corralation between Dana and Foresight Autonomous
Considering the 90-day investment horizon Dana Inc is expected to under-perform the Foresight Autonomous. In addition to that, Dana is 1.38 times more volatile than Foresight Autonomous Holdings. It trades about -0.12 of its total potential returns per unit of risk. Foresight Autonomous Holdings is currently generating about -0.04 per unit of volatility. If you would invest 68.00 in Foresight Autonomous Holdings on August 28, 2024 and sell it today you would lose (3.00) from holding Foresight Autonomous Holdings or give up 4.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Inc vs. Foresight Autonomous Holdings
Performance |
| Timeline |
| Dana Inc |
| Foresight Autonomous |
Dana and Foresight Autonomous Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana and Foresight Autonomous
The main advantage of trading using opposite Dana and Foresight Autonomous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana position performs unexpectedly, Foresight Autonomous 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 Foresight Autonomous will offset losses from the drop in Foresight Autonomous' long position.The idea behind Dana Inc and Foresight Autonomous Holdings 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.| Foresight Autonomous vs. Aeva Technologies | Foresight Autonomous vs. Luminar Technologies | Foresight Autonomous vs. Hesai Group American | Foresight Autonomous vs. Aeye Inc |
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.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |