Correlation Between Fairfax Financial and Reliq Health
Can any of the company-specific risk be diversified away by investing in both Fairfax Financial and Reliq 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 Fairfax Financial and Reliq Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fairfax Financial Holdings and Reliq Health Technologies, you can compare the effects of market volatilities on Fairfax Financial and Reliq 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 Fairfax Financial with a short position of Reliq Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fairfax Financial and Reliq Health.
Diversification Opportunities for Fairfax Financial and Reliq Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fairfax and Reliq is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fairfax Financial Holdings and Reliq Health Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reliq Health Technologies and Fairfax Financial 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 Fairfax Financial Holdings are associated (or correlated) with Reliq Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reliq Health Technologies has no effect on the direction of Fairfax Financial i.e., Fairfax Financial and Reliq Health go up and down completely randomly.
Pair Corralation between Fairfax Financial and Reliq Health
Assuming the 90 days trading horizon Fairfax Financial Holdings is expected to generate 0.27 times more return on investment than Reliq Health. However, Fairfax Financial Holdings is 3.71 times less risky than Reliq Health. It trades about 0.08 of its potential returns per unit of risk. Reliq Health Technologies is currently generating about -0.03 per unit of risk. If you would invest 1,684 in Fairfax Financial Holdings on August 30, 2024 and sell it today you would earn a total of 703.00 from holding Fairfax Financial Holdings or generate 41.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fairfax Financial Holdings vs. Reliq Health Technologies
Performance |
| Timeline |
| Fairfax Financial |
| Reliq Health Technologies |
Fairfax Financial and Reliq Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fairfax Financial and Reliq Health
The main advantage of trading using opposite Fairfax Financial and Reliq Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fairfax Financial position performs unexpectedly, Reliq 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 Reliq Health will offset losses from the drop in Reliq Health's long position.| Fairfax Financial vs. Fairfax Financial Holdings | Fairfax Financial vs. Fairfax Financial Holdings | Fairfax Financial vs. Fairfax Financial Holdings | Fairfax Financial vs. Fairfax Financial Holdings |
| Reliq Health vs. Solar Alliance Energy | Reliq Health vs. Braille Energy Systems | Reliq Health vs. MedMira | Reliq Health vs. Lite Access Technologies |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |