Correlation Between FibraHotel and Genworth Financial
Can any of the company-specific risk be diversified away by investing in both FibraHotel and Genworth Financial 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 FibraHotel and Genworth Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FibraHotel and Genworth Financial, you can compare the effects of market volatilities on FibraHotel and Genworth Financial 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 FibraHotel with a short position of Genworth Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of FibraHotel and Genworth Financial.
Diversification Opportunities for FibraHotel and Genworth Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FibraHotel and Genworth is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FibraHotel and Genworth Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genworth Financial and FibraHotel 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 FibraHotel are associated (or correlated) with Genworth Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genworth Financial has no effect on the direction of FibraHotel i.e., FibraHotel and Genworth Financial go up and down completely randomly.
Pair Corralation between FibraHotel and Genworth Financial
Assuming the 90 days trading horizon FibraHotel is expected to under-perform the Genworth Financial. In addition to that, FibraHotel is 2.26 times more volatile than Genworth Financial. It trades about -0.02 of its total potential returns per unit of risk. Genworth Financial is currently generating about 0.04 per unit of volatility. If you would invest 9,009 in Genworth Financial on August 24, 2024 and sell it today you would earn a total of 1,171 from holding Genworth Financial or generate 13.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FibraHotel vs. Genworth Financial
Performance |
| Timeline |
| FibraHotel |
| Genworth Financial |
FibraHotel and Genworth Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FibraHotel and Genworth Financial
The main advantage of trading using opposite FibraHotel and Genworth Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FibraHotel position performs unexpectedly, Genworth Financial 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 Genworth Financial will offset losses from the drop in Genworth Financial's long position.| FibraHotel vs. United Airlines Holdings | FibraHotel vs. Verizon Communications | FibraHotel vs. The Bank of | FibraHotel vs. Deutsche Bank Aktiengesellschaft |
| Genworth Financial vs. The Select Sector | Genworth Financial vs. Promotora y Operadora | Genworth Financial vs. iShares Global Timber | Genworth Financial vs. SPDR Series Trust |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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