Correlation Between Fbec Worldwide and Active Health
Can any of the company-specific risk be diversified away by investing in both Fbec Worldwide and Active Health 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 Fbec Worldwide and Active Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fbec Worldwide and Active Health Foods, you can compare the effects of market volatilities on Fbec Worldwide and Active Health 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 Fbec Worldwide with a short position of Active Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fbec Worldwide and Active Health.
Diversification Opportunities for Fbec Worldwide and Active Health
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fbec and Active is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fbec Worldwide and Active Health Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Active Health Foods and Fbec Worldwide 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 Fbec Worldwide are associated (or correlated) with Active Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Active Health Foods has no effect on the direction of Fbec Worldwide i.e., Fbec Worldwide and Active Health go up and down completely randomly.
Pair Corralation between Fbec Worldwide and Active Health
Given the investment horizon of 90 days Fbec Worldwide is expected to generate 1.58 times more return on investment than Active Health. However, Fbec Worldwide is 1.58 times more volatile than Active Health Foods. It trades about 0.13 of its potential returns per unit of risk. Active Health Foods is currently generating about 0.06 per unit of risk. If you would invest 0.04 in Fbec Worldwide on September 20, 2024 and sell it today you would earn a total of 0.03 from holding Fbec Worldwide or generate 75.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Fbec Worldwide vs. Active Health Foods
Performance |
| Timeline |
| Fbec Worldwide |
| Active Health Foods |
Fbec Worldwide and Active Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fbec Worldwide and Active Health
The main advantage of trading using opposite Fbec Worldwide and Active Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fbec Worldwide position performs unexpectedly, Active Health 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 Active Health will offset losses from the drop in Active Health's long position.| Fbec Worldwide vs. National Beverage Corp | Fbec Worldwide vs. Celsius Holdings | Fbec Worldwide vs. Monster Beverage Corp | Fbec Worldwide vs. Coca Cola Femsa SAB |
| Active Health vs. V Group | Active Health vs. Fbec Worldwide | Active Health vs. Hiru Corporation | Active Health vs. Alkame Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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