Correlation Between FORMPIPE SOFTWARE and FRACTAL GAMING
Can any of the company-specific risk be diversified away by investing in both FORMPIPE SOFTWARE and FRACTAL GAMING 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 FORMPIPE SOFTWARE and FRACTAL GAMING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FORMPIPE SOFTWARE AB and FRACTAL GAMING GROUP, you can compare the effects of market volatilities on FORMPIPE SOFTWARE and FRACTAL GAMING 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 FORMPIPE SOFTWARE with a short position of FRACTAL GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORMPIPE SOFTWARE and FRACTAL GAMING.
Diversification Opportunities for FORMPIPE SOFTWARE and FRACTAL GAMING
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FORMPIPE and FRACTAL is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding FORMPIPE SOFTWARE AB and FRACTAL GAMING GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRACTAL GAMING GROUP and FORMPIPE SOFTWARE 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 FORMPIPE SOFTWARE AB are associated (or correlated) with FRACTAL GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRACTAL GAMING GROUP has no effect on the direction of FORMPIPE SOFTWARE i.e., FORMPIPE SOFTWARE and FRACTAL GAMING go up and down completely randomly.
Pair Corralation between FORMPIPE SOFTWARE and FRACTAL GAMING
Assuming the 90 days horizon FORMPIPE SOFTWARE AB is expected to generate 2.5 times more return on investment than FRACTAL GAMING. However, FORMPIPE SOFTWARE is 2.5 times more volatile than FRACTAL GAMING GROUP. It trades about 0.17 of its potential returns per unit of risk. FRACTAL GAMING GROUP is currently generating about -0.25 per unit of risk. If you would invest 190.00 in FORMPIPE SOFTWARE AB on September 2, 2024 and sell it today you would earn a total of 22.00 from holding FORMPIPE SOFTWARE AB or generate 11.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FORMPIPE SOFTWARE AB vs. FRACTAL GAMING GROUP
Performance |
| Timeline |
| FORMPIPE SOFTWARE |
| FRACTAL GAMING GROUP |
FORMPIPE SOFTWARE and FRACTAL GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FORMPIPE SOFTWARE and FRACTAL GAMING
The main advantage of trading using opposite FORMPIPE SOFTWARE and FRACTAL GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORMPIPE SOFTWARE position performs unexpectedly, FRACTAL GAMING 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 FRACTAL GAMING will offset losses from the drop in FRACTAL GAMING's long position.| FORMPIPE SOFTWARE vs. Superior Plus Corp | FORMPIPE SOFTWARE vs. NMI Holdings | FORMPIPE SOFTWARE vs. Origin Agritech | FORMPIPE SOFTWARE vs. SIVERS SEMICONDUCTORS AB |
| FRACTAL GAMING vs. Superior Plus Corp | FRACTAL GAMING vs. NMI Holdings | FRACTAL GAMING vs. Origin Agritech | FRACTAL GAMING vs. SIVERS SEMICONDUCTORS AB |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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