Correlation Between First Investors and First Investors
Can any of the company-specific risk be diversified away by investing in both First Investors and First Investors 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 First Investors and First Investors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Investors Select and First Investors Select, you can compare the effects of market volatilities on First Investors and First Investors 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 First Investors with a short position of First Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Investors and First Investors.
Diversification Opportunities for First Investors and First Investors
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between First and First is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding First Investors Select and First Investors Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Investors Select and First Investors 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 First Investors Select are associated (or correlated) with First Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Investors Select has no effect on the direction of First Investors i.e., First Investors and First Investors go up and down completely randomly.
Pair Corralation between First Investors and First Investors
Assuming the 90 days horizon First Investors is expected to generate 1.0 times less return on investment than First Investors. But when comparing it to its historical volatility, First Investors Select is 1.0 times less risky than First Investors. It trades about 0.32 of its potential returns per unit of risk. First Investors Select is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 1,272 in First Investors Select on August 26, 2024 and sell it today you would earn a total of 96.00 from holding First Investors Select or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Investors Select vs. First Investors Select
Performance |
| Timeline |
| First Investors Select |
| First Investors Select |
First Investors and First Investors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Investors and First Investors
The main advantage of trading using opposite First Investors and First Investors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Investors position performs unexpectedly, First Investors 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 First Investors will offset losses from the drop in First Investors' long position.| First Investors vs. Fidelity Advisor Technology | First Investors vs. Firsthand Technology Opportunities | First Investors vs. Pgim Jennison Technology | First Investors vs. Science Technology Fund |
| First Investors vs. T Rowe Price | First Investors vs. Knights Of Umbus | First Investors vs. Federated Mdt Large | First Investors vs. Touchstone Large Cap |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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