Correlation Between Fidus Investment and Flutter Entertainment
Can any of the company-specific risk be diversified away by investing in both Fidus Investment and Flutter Entertainment 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 Fidus Investment and Flutter Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidus Investment Corp and Flutter Entertainment plc, you can compare the effects of market volatilities on Fidus Investment and Flutter Entertainment 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 Fidus Investment with a short position of Flutter Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and Flutter Entertainment.
Diversification Opportunities for Fidus Investment and Flutter Entertainment
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidus and Flutter is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp and Flutter Entertainment plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flutter Entertainment plc and Fidus Investment 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 Fidus Investment Corp are associated (or correlated) with Flutter Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flutter Entertainment plc has no effect on the direction of Fidus Investment i.e., Fidus Investment and Flutter Entertainment go up and down completely randomly.
Pair Corralation between Fidus Investment and Flutter Entertainment
Given the investment horizon of 90 days Fidus Investment is expected to generate 1.86 times less return on investment than Flutter Entertainment. But when comparing it to its historical volatility, Fidus Investment Corp is 3.08 times less risky than Flutter Entertainment. It trades about 0.08 of its potential returns per unit of risk. Flutter Entertainment plc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 19,670 in Flutter Entertainment plc on September 12, 2024 and sell it today you would earn a total of 7,801 from holding Flutter Entertainment plc or generate 39.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidus Investment Corp vs. Flutter Entertainment plc
Performance |
| Timeline |
| Fidus Investment Corp |
| Flutter Entertainment plc |
Fidus Investment and Flutter Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidus Investment and Flutter Entertainment
The main advantage of trading using opposite Fidus Investment and Flutter Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidus Investment position performs unexpectedly, Flutter Entertainment 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 Flutter Entertainment will offset losses from the drop in Flutter Entertainment's long position.| Fidus Investment vs. Gladstone Investment | Fidus Investment vs. Horizon Technology Finance | Fidus Investment vs. Stellus Capital Investment | Fidus Investment vs. Prospect Capital |
| Flutter Entertainment vs. Fidus Investment Corp | Flutter Entertainment vs. Eastman Chemical | Flutter Entertainment vs. Mativ Holdings | Flutter Entertainment vs. The Mosaic |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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