Correlation Between GlobalData PLC and FC Investment
Can any of the company-specific risk be diversified away by investing in both GlobalData PLC and FC Investment 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 GlobalData PLC and FC Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlobalData PLC and FC Investment Trust, you can compare the effects of market volatilities on GlobalData PLC and FC Investment 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 GlobalData PLC with a short position of FC Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlobalData PLC and FC Investment.
Diversification Opportunities for GlobalData PLC and FC Investment
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between GlobalData and FCIT is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding GlobalData PLC and FC Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FC Investment Trust and GlobalData PLC 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 GlobalData PLC are associated (or correlated) with FC Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FC Investment Trust has no effect on the direction of GlobalData PLC i.e., GlobalData PLC and FC Investment go up and down completely randomly.
Pair Corralation between GlobalData PLC and FC Investment
Assuming the 90 days trading horizon GlobalData PLC is expected to generate 2.48 times more return on investment than FC Investment. However, GlobalData PLC is 2.48 times more volatile than FC Investment Trust. It trades about 0.04 of its potential returns per unit of risk. FC Investment Trust is currently generating about 0.06 per unit of risk. If you would invest 15,132 in GlobalData PLC on October 13, 2024 and sell it today you would earn a total of 4,968 from holding GlobalData PLC or generate 32.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.56% |
| Values | Daily Returns |
GlobalData PLC vs. FC Investment Trust
Performance |
| Timeline |
| GlobalData PLC |
| FC Investment Trust |
GlobalData PLC and FC Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlobalData PLC and FC Investment
The main advantage of trading using opposite GlobalData PLC and FC Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlobalData PLC position performs unexpectedly, FC Investment 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 FC Investment will offset losses from the drop in FC Investment's long position.| GlobalData PLC vs. Samsung Electronics Co | GlobalData PLC vs. Impax Asset Management | GlobalData PLC vs. Waste Management | GlobalData PLC vs. JB Hunt Transport |
| FC Investment vs. Ion Beam Applications | FC Investment vs. Lundin Mining Corp | FC Investment vs. Various Eateries PLC | FC Investment vs. GlobalData PLC |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |