Correlation Between Fair Isaac and Ke Holdings
Can any of the company-specific risk be diversified away by investing in both Fair Isaac and Ke Holdings 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 Fair Isaac and Ke Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fair Isaac and Ke Holdings, you can compare the effects of market volatilities on Fair Isaac and Ke Holdings 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 Fair Isaac with a short position of Ke Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fair Isaac and Ke Holdings.
Diversification Opportunities for Fair Isaac and Ke Holdings
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fair and BEKE is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Fair Isaac and Ke Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ke Holdings and Fair Isaac 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 Fair Isaac are associated (or correlated) with Ke Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ke Holdings has no effect on the direction of Fair Isaac i.e., Fair Isaac and Ke Holdings go up and down completely randomly.
Pair Corralation between Fair Isaac and Ke Holdings
Given the investment horizon of 90 days Fair Isaac is expected to generate 0.6 times more return on investment than Ke Holdings. However, Fair Isaac is 1.66 times less risky than Ke Holdings. It trades about 0.43 of its potential returns per unit of risk. Ke Holdings is currently generating about -0.21 per unit of risk. If you would invest 199,094 in Fair Isaac on September 3, 2024 and sell it today you would earn a total of 38,409 from holding Fair Isaac or generate 19.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fair Isaac vs. Ke Holdings
Performance |
| Timeline |
| Fair Isaac |
| Ke Holdings |
Fair Isaac and Ke Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fair Isaac and Ke Holdings
The main advantage of trading using opposite Fair Isaac and Ke Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fair Isaac position performs unexpectedly, Ke Holdings 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 Ke Holdings will offset losses from the drop in Ke Holdings' long position.| Fair Isaac vs. SAP SE ADR | Fair Isaac vs. Tyler Technologies | Fair Isaac vs. Roper Technologies, Common | Fair Isaac vs. Cadence Design Systems |
| Ke Holdings vs. Marcus Millichap | Ke Holdings vs. Digitalbridge Group | Ke Holdings vs. Jones Lang LaSalle | Ke Holdings vs. CBRE Group Class |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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