Correlation Between Fast Ejendom and FOM Technologies
Can any of the company-specific risk be diversified away by investing in both Fast Ejendom and FOM Technologies 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 Fast Ejendom and FOM Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fast Ejendom and FOM Technologies AS, you can compare the effects of market volatilities on Fast Ejendom and FOM Technologies 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 Fast Ejendom with a short position of FOM Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fast Ejendom and FOM Technologies.
Diversification Opportunities for Fast Ejendom and FOM Technologies
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fast and FOM is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Fast Ejendom and FOM Technologies AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FOM Technologies and Fast Ejendom 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 Fast Ejendom are associated (or correlated) with FOM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FOM Technologies has no effect on the direction of Fast Ejendom i.e., Fast Ejendom and FOM Technologies go up and down completely randomly.
Pair Corralation between Fast Ejendom and FOM Technologies
Assuming the 90 days trading horizon Fast Ejendom is expected to generate 0.45 times more return on investment than FOM Technologies. However, Fast Ejendom is 2.25 times less risky than FOM Technologies. It trades about 0.23 of its potential returns per unit of risk. FOM Technologies AS is currently generating about 0.02 per unit of risk. If you would invest 11,800 in Fast Ejendom on September 13, 2024 and sell it today you would earn a total of 800.00 from holding Fast Ejendom or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fast Ejendom vs. FOM Technologies AS
Performance |
| Timeline |
| Fast Ejendom |
| FOM Technologies |
Fast Ejendom and FOM Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fast Ejendom and FOM Technologies
The main advantage of trading using opposite Fast Ejendom and FOM Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fast Ejendom position performs unexpectedly, FOM Technologies 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 FOM Technologies will offset losses from the drop in FOM Technologies' long position.| Fast Ejendom vs. Prime Office AS | Fast Ejendom vs. First Farms AS | Fast Ejendom vs. Jeudan | Fast Ejendom vs. Gabriel Holding |
| FOM Technologies vs. Vestas Wind Systems | FOM Technologies vs. Brd Klee AS | FOM Technologies vs. Hydract AS |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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