Correlation Between Figs and Destiny Tech100
Can any of the company-specific risk be diversified away by investing in both Figs and Destiny Tech100 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 Figs and Destiny Tech100 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Figs Inc and Destiny Tech100, you can compare the effects of market volatilities on Figs and Destiny Tech100 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 Figs with a short position of Destiny Tech100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Figs and Destiny Tech100.
Diversification Opportunities for Figs and Destiny Tech100
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Figs and Destiny is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Figs Inc and Destiny Tech100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Destiny Tech100 and Figs 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 Figs Inc are associated (or correlated) with Destiny Tech100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Destiny Tech100 has no effect on the direction of Figs i.e., Figs and Destiny Tech100 go up and down completely randomly.
Pair Corralation between Figs and Destiny Tech100
Given the investment horizon of 90 days Figs Inc is expected to under-perform the Destiny Tech100. But the stock apears to be less risky and, when comparing its historical volatility, Figs Inc is 3.02 times less risky than Destiny Tech100. The stock trades about -0.14 of its potential returns per unit of risk. The Destiny Tech100 is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 1,116 in Destiny Tech100 on August 24, 2024 and sell it today you would earn a total of 2,832 from holding Destiny Tech100 or generate 253.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Figs Inc vs. Destiny Tech100
Performance |
| Timeline |
| Figs Inc |
| Destiny Tech100 |
Figs and Destiny Tech100 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Figs and Destiny Tech100
The main advantage of trading using opposite Figs and Destiny Tech100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Figs position performs unexpectedly, Destiny Tech100 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 Destiny Tech100 will offset losses from the drop in Destiny Tech100's long position.The idea behind Figs Inc and Destiny Tech100 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Destiny Tech100 vs. Radcom | Destiny Tech100 vs. Dave Busters Entertainment | Destiny Tech100 vs. Vince Holding Corp | Destiny Tech100 vs. Figs Inc |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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