Correlation Between FibroGen and FibraHotel
Can any of the company-specific risk be diversified away by investing in both FibroGen and FibraHotel 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 FibroGen and FibraHotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FibroGen and FibraHotel, you can compare the effects of market volatilities on FibroGen and FibraHotel 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 FibroGen with a short position of FibraHotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of FibroGen and FibraHotel.
Diversification Opportunities for FibroGen and FibraHotel
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between FibroGen and FibraHotel is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding FibroGen and FibraHotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FibraHotel and FibroGen 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 FibroGen are associated (or correlated) with FibraHotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FibraHotel has no effect on the direction of FibroGen i.e., FibroGen and FibraHotel go up and down completely randomly.
Pair Corralation between FibroGen and FibraHotel
Assuming the 90 days trading horizon FibroGen is expected to generate 1.49 times more return on investment than FibraHotel. However, FibroGen is 1.49 times more volatile than FibraHotel. It trades about 0.26 of its potential returns per unit of risk. FibraHotel is currently generating about 0.17 per unit of risk. If you would invest 640.00 in FibroGen on August 29, 2024 and sell it today you would earn a total of 154.00 from holding FibroGen or generate 24.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
FibroGen vs. FibraHotel
Performance |
| Timeline |
| FibroGen |
| FibraHotel |
FibroGen and FibraHotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FibroGen and FibraHotel
The main advantage of trading using opposite FibroGen and FibraHotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FibroGen position performs unexpectedly, FibraHotel 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 FibraHotel will offset losses from the drop in FibraHotel's long position.| FibroGen vs. Vertex Pharmaceuticals | FibroGen vs. Bristol Myers Squibb | FibroGen vs. The Select Sector | FibroGen vs. Promotora y Operadora |
| FibraHotel vs. UnitedHealth Group Incorporated | FibraHotel vs. Lockheed Martin | FibraHotel vs. The Select Sector | FibraHotel vs. SPDR Series Trust |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |