Correlation Between FTI Consulting and Upwork
Can any of the company-specific risk be diversified away by investing in both FTI Consulting and Upwork 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 FTI Consulting and Upwork into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FTI Consulting and Upwork Inc, you can compare the effects of market volatilities on FTI Consulting and Upwork 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 FTI Consulting with a short position of Upwork. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTI Consulting and Upwork.
Diversification Opportunities for FTI Consulting and Upwork
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FTI and Upwork is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding FTI Consulting and Upwork Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upwork Inc and FTI Consulting 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 FTI Consulting are associated (or correlated) with Upwork. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upwork Inc has no effect on the direction of FTI Consulting i.e., FTI Consulting and Upwork go up and down completely randomly.
Pair Corralation between FTI Consulting and Upwork
Considering the 90-day investment horizon FTI Consulting is expected to generate 63.31 times less return on investment than Upwork. But when comparing it to its historical volatility, FTI Consulting is 2.95 times less risky than Upwork. It trades about 0.01 of its potential returns per unit of risk. Upwork Inc is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,265 in Upwork Inc on August 25, 2024 and sell it today you would earn a total of 337.00 from holding Upwork Inc or generate 26.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FTI Consulting vs. Upwork Inc
Performance |
| Timeline |
| FTI Consulting |
| Upwork Inc |
FTI Consulting and Upwork Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FTI Consulting and Upwork
The main advantage of trading using opposite FTI Consulting and Upwork positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTI Consulting position performs unexpectedly, Upwork 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 Upwork will offset losses from the drop in Upwork's long position.| FTI Consulting vs. CRA International | FTI Consulting vs. Thermon Group Holdings | FTI Consulting vs. Forrester Research | FTI Consulting vs. Forestar Group |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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