Correlation Between Federal Home and Aeroports
Can any of the company-specific risk be diversified away by investing in both Federal Home and Aeroports 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 Federal Home and Aeroports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal Home Loan and Aeroports de Paris, you can compare the effects of market volatilities on Federal Home and Aeroports 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 Federal Home with a short position of Aeroports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Home and Aeroports.
Diversification Opportunities for Federal Home and Aeroports
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Federal and Aeroports is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Federal Home Loan and Aeroports de Paris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeroports de Paris and Federal Home 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 Federal Home Loan are associated (or correlated) with Aeroports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeroports de Paris has no effect on the direction of Federal Home i.e., Federal Home and Aeroports go up and down completely randomly.
Pair Corralation between Federal Home and Aeroports
Assuming the 90 days horizon Federal Home Loan is expected to generate 9.65 times more return on investment than Aeroports. However, Federal Home is 9.65 times more volatile than Aeroports de Paris. It trades about 0.48 of its potential returns per unit of risk. Aeroports de Paris is currently generating about 0.05 per unit of risk. If you would invest 116.00 in Federal Home Loan on September 1, 2024 and sell it today you would earn a total of 180.00 from holding Federal Home Loan or generate 155.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Federal Home Loan vs. Aeroports de Paris
Performance |
| Timeline |
| Federal Home Loan |
| Aeroports de Paris |
Federal Home and Aeroports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Home and Aeroports
The main advantage of trading using opposite Federal Home and Aeroports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Home position performs unexpectedly, Aeroports 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 Aeroports will offset losses from the drop in Aeroports' long position.| Federal Home vs. Superior Plus Corp | Federal Home vs. NMI Holdings | Federal Home vs. Origin Agritech | Federal Home vs. SIVERS SEMICONDUCTORS AB |
| Aeroports vs. ANTA SPORTS PRODUCT | Aeroports vs. Cleanaway Waste Management | Aeroports vs. GRUPO CARSO A1 | Aeroports vs. ePlay Digital |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |