Correlation Between FGI Industries and IRobot
Can any of the company-specific risk be diversified away by investing in both FGI Industries and IRobot 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 FGI Industries and IRobot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FGI Industries and iRobot, you can compare the effects of market volatilities on FGI Industries and IRobot 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 FGI Industries with a short position of IRobot. Check out your portfolio center. Please also check ongoing floating volatility patterns of FGI Industries and IRobot.
Diversification Opportunities for FGI Industries and IRobot
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FGI and IRobot is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding FGI Industries and iRobot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iRobot and FGI Industries 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 FGI Industries are associated (or correlated) with IRobot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iRobot has no effect on the direction of FGI Industries i.e., FGI Industries and IRobot go up and down completely randomly.
Pair Corralation between FGI Industries and IRobot
Considering the 90-day investment horizon FGI Industries is expected to generate 0.72 times more return on investment than IRobot. However, FGI Industries is 1.39 times less risky than IRobot. It trades about -0.01 of its potential returns per unit of risk. iRobot is currently generating about -0.01 per unit of risk. If you would invest 87.00 in FGI Industries on August 28, 2024 and sell it today you would lose (6.00) from holding FGI Industries or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
FGI Industries vs. iRobot
Performance |
| Timeline |
| FGI Industries |
| iRobot |
FGI Industries and IRobot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FGI Industries and IRobot
The main advantage of trading using opposite FGI Industries and IRobot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FGI Industries position performs unexpectedly, IRobot 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 IRobot will offset losses from the drop in IRobot's long position.| FGI Industries vs. Fundamental Global | FGI Industries vs. Yoshitsu Co Ltd | FGI Industries vs. Hour Loop | FGI Industries vs. Direct Digital Holdings |
| IRobot vs. Tempur Sealy International | IRobot vs. La Z Boy Incorporated | IRobot vs. Purple Innovation | IRobot vs. MasterBrand |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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