Correlation Between EROAD and FleetPartners
Can any of the company-specific risk be diversified away by investing in both EROAD and FleetPartners 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 EROAD and FleetPartners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EROAD and FleetPartners Group, you can compare the effects of market volatilities on EROAD and FleetPartners 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 EROAD with a short position of FleetPartners. Check out your portfolio center. Please also check ongoing floating volatility patterns of EROAD and FleetPartners.
Diversification Opportunities for EROAD and FleetPartners
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EROAD and FleetPartners is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding EROAD and FleetPartners Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FleetPartners Group and EROAD 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 EROAD are associated (or correlated) with FleetPartners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FleetPartners Group has no effect on the direction of EROAD i.e., EROAD and FleetPartners go up and down completely randomly.
Pair Corralation between EROAD and FleetPartners
Assuming the 90 days trading horizon EROAD is expected to generate 1.55 times less return on investment than FleetPartners. In addition to that, EROAD is 1.01 times more volatile than FleetPartners Group. It trades about 0.11 of its total potential returns per unit of risk. FleetPartners Group is currently generating about 0.17 per unit of volatility. If you would invest 293.00 in FleetPartners Group on September 1, 2024 and sell it today you would earn a total of 24.00 from holding FleetPartners Group or generate 8.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
EROAD vs. FleetPartners Group
Performance |
| Timeline |
| EROAD |
| FleetPartners Group |
EROAD and FleetPartners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EROAD and FleetPartners
The main advantage of trading using opposite EROAD and FleetPartners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EROAD position performs unexpectedly, FleetPartners 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 FleetPartners will offset losses from the drop in FleetPartners' long position.| EROAD vs. Centuria Industrial Reit | EROAD vs. Sky Metals | EROAD vs. The Environmental Group | EROAD vs. Qbe Insurance Group |
| FleetPartners vs. Platinum Asia Investments | FleetPartners vs. G8 Education | FleetPartners vs. Perseus Mining | FleetPartners vs. Centuria Industrial Reit |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |