Correlation Between FORWARD AIR and Intel
Can any of the company-specific risk be diversified away by investing in both FORWARD AIR and Intel 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 FORWARD AIR and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FORWARD AIR P and Intel, you can compare the effects of market volatilities on FORWARD AIR and Intel 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 FORWARD AIR with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORWARD AIR and Intel.
Diversification Opportunities for FORWARD AIR and Intel
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FORWARD and Intel is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding FORWARD AIR P and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and FORWARD AIR 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 FORWARD AIR P are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of FORWARD AIR i.e., FORWARD AIR and Intel go up and down completely randomly.
Pair Corralation between FORWARD AIR and Intel
Assuming the 90 days horizon FORWARD AIR P is expected to under-perform the Intel. In addition to that, FORWARD AIR is 1.52 times more volatile than Intel. It trades about -0.03 of its total potential returns per unit of risk. Intel is currently generating about 0.0 per unit of volatility. If you would invest 2,356 in Intel on September 20, 2024 and sell it today you would lose (410.00) from holding Intel or give up 17.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
FORWARD AIR P vs. Intel
Performance |
| Timeline |
| FORWARD AIR P |
| Intel |
FORWARD AIR and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FORWARD AIR and Intel
The main advantage of trading using opposite FORWARD AIR and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORWARD AIR position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| FORWARD AIR vs. Apple Inc | FORWARD AIR vs. Apple Inc | FORWARD AIR vs. Apple Inc | FORWARD AIR vs. Apple Inc |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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