Correlation Between Fbc Hldg and Gemz Corp
Can any of the company-specific risk be diversified away by investing in both Fbc Hldg and Gemz Corp 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 Fbc Hldg and Gemz Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fbc Hldg and Gemz Corp, you can compare the effects of market volatilities on Fbc Hldg and Gemz Corp 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 Fbc Hldg with a short position of Gemz Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fbc Hldg and Gemz Corp.
Diversification Opportunities for Fbc Hldg and Gemz Corp
Good diversification
The 3 months correlation between Fbc and Gemz is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Fbc Hldg and Gemz Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gemz Corp and Fbc Hldg 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 Fbc Hldg are associated (or correlated) with Gemz Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gemz Corp has no effect on the direction of Fbc Hldg i.e., Fbc Hldg and Gemz Corp go up and down completely randomly.
Pair Corralation between Fbc Hldg and Gemz Corp
Given the investment horizon of 90 days Fbc Hldg is expected to generate 13.21 times more return on investment than Gemz Corp. However, Fbc Hldg is 13.21 times more volatile than Gemz Corp. It trades about 0.21 of its potential returns per unit of risk. Gemz Corp is currently generating about 0.15 per unit of risk. If you would invest 0.00 in Fbc Hldg on August 26, 2024 and sell it today you would earn a total of 0.01 from holding Fbc Hldg or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fbc Hldg vs. Gemz Corp
Performance |
| Timeline |
| Fbc Hldg |
| Gemz Corp |
Fbc Hldg and Gemz Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fbc Hldg and Gemz Corp
The main advantage of trading using opposite Fbc Hldg and Gemz Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fbc Hldg position performs unexpectedly, Gemz Corp 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 Gemz Corp will offset losses from the drop in Gemz Corp's long position.| Fbc Hldg vs. Reitmans Limited | Fbc Hldg vs. Reitmans Limited | Fbc Hldg vs. Lulus Fashion Lounge | Fbc Hldg vs. Duluth Holdings |
| Gemz Corp vs. Absolute Health and | Gemz Corp vs. China Health Management | Gemz Corp vs. Embrace Change Acquisition | Gemz Corp vs. TransAKT |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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