Correlation Between Fletcher King and Secure Property
Can any of the company-specific risk be diversified away by investing in both Fletcher King and Secure Property 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 Fletcher King and Secure Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fletcher King Plc and Secure Property Development, you can compare the effects of market volatilities on Fletcher King and Secure Property 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 Fletcher King with a short position of Secure Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fletcher King and Secure Property.
Diversification Opportunities for Fletcher King and Secure Property
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fletcher and Secure is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Fletcher King Plc and Secure Property Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Secure Property Deve and Fletcher King 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 Fletcher King Plc are associated (or correlated) with Secure Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Secure Property Deve has no effect on the direction of Fletcher King i.e., Fletcher King and Secure Property go up and down completely randomly.
Pair Corralation between Fletcher King and Secure Property
Assuming the 90 days trading horizon Fletcher King Plc is expected to generate 1.39 times more return on investment than Secure Property. However, Fletcher King is 1.39 times more volatile than Secure Property Development. It trades about 0.01 of its potential returns per unit of risk. Secure Property Development is currently generating about -0.03 per unit of risk. If you would invest 3,734 in Fletcher King Plc on November 2, 2024 and sell it today you would lose (84.00) from holding Fletcher King Plc or give up 2.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fletcher King Plc vs. Secure Property Development
Performance |
| Timeline |
| Fletcher King Plc |
| Secure Property Deve |
Fletcher King and Secure Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fletcher King and Secure Property
The main advantage of trading using opposite Fletcher King and Secure Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fletcher King position performs unexpectedly, Secure Property 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 Secure Property will offset losses from the drop in Secure Property's long position.| Fletcher King vs. Datalogic | Fletcher King vs. Games Workshop Group | Fletcher King vs. Beazer Homes USA | Fletcher King vs. Automatic Data Processing |
| Secure Property vs. Gaming Realms plc | Secure Property vs. Lindsell Train Investment | Secure Property vs. Fulcrum Metals PLC | Secure Property vs. Golden Metal Resources |
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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