Correlation Between Fuse Science and Smartmetric
Can any of the company-specific risk be diversified away by investing in both Fuse Science and Smartmetric 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 Fuse Science and Smartmetric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fuse Science and Smartmetric, you can compare the effects of market volatilities on Fuse Science and Smartmetric 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 Fuse Science with a short position of Smartmetric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fuse Science and Smartmetric.
Diversification Opportunities for Fuse Science and Smartmetric
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fuse and Smartmetric is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Fuse Science and Smartmetric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartmetric and Fuse Science 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 Fuse Science are associated (or correlated) with Smartmetric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartmetric has no effect on the direction of Fuse Science i.e., Fuse Science and Smartmetric go up and down completely randomly.
Pair Corralation between Fuse Science and Smartmetric
Given the investment horizon of 90 days Fuse Science is expected to generate 26.83 times less return on investment than Smartmetric. But when comparing it to its historical volatility, Fuse Science is 10.0 times less risky than Smartmetric. It trades about 0.06 of its potential returns per unit of risk. Smartmetric is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 0.05 in Smartmetric on November 3, 2024 and sell it today you would lose (0.04) from holding Smartmetric or give up 80.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Fuse Science vs. Smartmetric
Performance |
| Timeline |
| Fuse Science |
| Smartmetric |
Fuse Science and Smartmetric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fuse Science and Smartmetric
The main advantage of trading using opposite Fuse Science and Smartmetric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fuse Science position performs unexpectedly, Smartmetric 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 Smartmetric will offset losses from the drop in Smartmetric's long position.| Fuse Science vs. CAVU Resources | Fuse Science vs. Epazz Inc | Fuse Science vs. Pervasip Corp | Fuse Science vs. Grillit |
| Smartmetric vs. Telos Corp | Smartmetric vs. Fuse Science | Smartmetric vs. Data443 Risk Mitigation | Smartmetric vs. Taoping |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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