Correlation Between Fair Oaks and Seraphim Space
Can any of the company-specific risk be diversified away by investing in both Fair Oaks and Seraphim Space 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 Fair Oaks and Seraphim Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fair Oaks Income and Seraphim Space Investment, you can compare the effects of market volatilities on Fair Oaks and Seraphim Space 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 Fair Oaks with a short position of Seraphim Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fair Oaks and Seraphim Space.
Diversification Opportunities for Fair Oaks and Seraphim Space
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fair and Seraphim is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Fair Oaks Income and Seraphim Space Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seraphim Space Investment and Fair Oaks 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 Fair Oaks Income are associated (or correlated) with Seraphim Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seraphim Space Investment has no effect on the direction of Fair Oaks i.e., Fair Oaks and Seraphim Space go up and down completely randomly.
Pair Corralation between Fair Oaks and Seraphim Space
Assuming the 90 days trading horizon Fair Oaks is expected to generate 6.74 times less return on investment than Seraphim Space. But when comparing it to its historical volatility, Fair Oaks Income is 2.28 times less risky than Seraphim Space. It trades about 0.21 of its potential returns per unit of risk. Seraphim Space Investment is currently generating about 0.63 of returns per unit of risk over similar time horizon. If you would invest 4,650 in Seraphim Space Investment on September 1, 2024 and sell it today you would earn a total of 1,330 from holding Seraphim Space Investment or generate 28.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Fair Oaks Income vs. Seraphim Space Investment
Performance |
| Timeline |
| Fair Oaks Income |
| Seraphim Space Investment |
Fair Oaks and Seraphim Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fair Oaks and Seraphim Space
The main advantage of trading using opposite Fair Oaks and Seraphim Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fair Oaks position performs unexpectedly, Seraphim Space 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 Seraphim Space will offset losses from the drop in Seraphim Space's long position.| Fair Oaks vs. Toyota Motor Corp | Fair Oaks vs. SoftBank Group Corp | Fair Oaks vs. OTP Bank Nyrt | Fair Oaks vs. Las Vegas Sands |
| Seraphim Space vs. Fair Oaks Income | Seraphim Space vs. Creo Medical Group | Seraphim Space vs. Take Two Interactive Software | Seraphim Space vs. Systemair 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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