Correlation Between Exmar NV and Fagron NV
Can any of the company-specific risk be diversified away by investing in both Exmar NV and Fagron NV 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 Exmar NV and Fagron NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exmar NV and Fagron NV, you can compare the effects of market volatilities on Exmar NV and Fagron NV 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 Exmar NV with a short position of Fagron NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exmar NV and Fagron NV.
Diversification Opportunities for Exmar NV and Fagron NV
Good diversification
The 3 months correlation between Exmar and Fagron is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Exmar NV and Fagron NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fagron NV and Exmar NV 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 Exmar NV are associated (or correlated) with Fagron NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fagron NV has no effect on the direction of Exmar NV i.e., Exmar NV and Fagron NV go up and down completely randomly.
Pair Corralation between Exmar NV and Fagron NV
Assuming the 90 days trading horizon Exmar NV is expected to generate 1.69 times more return on investment than Fagron NV. However, Exmar NV is 1.69 times more volatile than Fagron NV. It trades about 0.08 of its potential returns per unit of risk. Fagron NV is currently generating about 0.06 per unit of risk. If you would invest 352.00 in Exmar NV on August 29, 2024 and sell it today you would earn a total of 468.00 from holding Exmar NV or generate 132.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exmar NV vs. Fagron NV
Performance |
| Timeline |
| Exmar NV |
| Fagron NV |
Exmar NV and Fagron NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exmar NV and Fagron NV
The main advantage of trading using opposite Exmar NV and Fagron NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exmar NV position performs unexpectedly, Fagron NV 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 Fagron NV will offset losses from the drop in Fagron NV's long position.| Exmar NV vs. EVS Broadcast Equipment | Exmar NV vs. NV Bekaert SA | Exmar NV vs. Tessenderlo | Exmar NV vs. Melexis NV |
| Fagron NV vs. Tessenderlo | Fagron NV vs. NV Bekaert SA | Fagron NV vs. Ontex Group NV | Fagron NV vs. Argen X |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |