Correlation Between Faraday Future and Stoneridge
Can any of the company-specific risk be diversified away by investing in both Faraday Future and Stoneridge 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 Faraday Future and Stoneridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Faraday Future Intelligent and Stoneridge, you can compare the effects of market volatilities on Faraday Future and Stoneridge 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 Faraday Future with a short position of Stoneridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Faraday Future and Stoneridge.
Diversification Opportunities for Faraday Future and Stoneridge
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Faraday and Stoneridge is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Faraday Future Intelligent and Stoneridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stoneridge and Faraday Future 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 Faraday Future Intelligent are associated (or correlated) with Stoneridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stoneridge has no effect on the direction of Faraday Future i.e., Faraday Future and Stoneridge go up and down completely randomly.
Pair Corralation between Faraday Future and Stoneridge
Assuming the 90 days horizon Faraday Future Intelligent is expected to under-perform the Stoneridge. In addition to that, Faraday Future is 3.71 times more volatile than Stoneridge. It trades about -0.36 of its total potential returns per unit of risk. Stoneridge is currently generating about -0.2 per unit of volatility. If you would invest 586.00 in Stoneridge on November 2, 2024 and sell it today you would lose (76.00) from holding Stoneridge or give up 12.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Faraday Future Intelligent vs. Stoneridge
Performance |
| Timeline |
| Faraday Future Intel |
| Stoneridge |
Faraday Future and Stoneridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Faraday Future and Stoneridge
The main advantage of trading using opposite Faraday Future and Stoneridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Faraday Future position performs unexpectedly, Stoneridge 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 Stoneridge will offset losses from the drop in Stoneridge's long position.| Faraday Future vs. HYZON Motors | Faraday Future vs. NextNav Warrant | Faraday Future vs. Inspira Technologies Oxy | Faraday Future vs. AppTech Payments Corp |
| Stoneridge vs. Monro Muffler Brake | Stoneridge vs. Motorcar Parts of | Stoneridge vs. Standard Motor Products | Stoneridge vs. Douglas Dynamics |
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 Stocks Directory module to find actively traded stocks across global markets.
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