Correlation Between Fluent and Supercom
Can any of the company-specific risk be diversified away by investing in both Fluent and Supercom 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 Fluent and Supercom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fluent Inc and Supercom, you can compare the effects of market volatilities on Fluent and Supercom 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 Fluent with a short position of Supercom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fluent and Supercom.
Diversification Opportunities for Fluent and Supercom
Very weak diversification
The 3 months correlation between Fluent and Supercom is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Fluent Inc and Supercom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supercom and Fluent 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 Fluent Inc are associated (or correlated) with Supercom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supercom has no effect on the direction of Fluent i.e., Fluent and Supercom go up and down completely randomly.
Pair Corralation between Fluent and Supercom
Given the investment horizon of 90 days Fluent Inc is expected to under-perform the Supercom. In addition to that, Fluent is 1.03 times more volatile than Supercom. It trades about -0.05 of its total potential returns per unit of risk. Supercom is currently generating about 0.17 per unit of volatility. If you would invest 319.00 in Supercom on September 1, 2024 and sell it today you would earn a total of 47.00 from holding Supercom or generate 14.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fluent Inc vs. Supercom
Performance |
| Timeline |
| Fluent Inc |
| Supercom |
Fluent and Supercom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fluent and Supercom
The main advantage of trading using opposite Fluent and Supercom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fluent position performs unexpectedly, Supercom 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 Supercom will offset losses from the drop in Supercom's long position.The idea behind Fluent Inc and Supercom 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.| Supercom vs. Desktop Metal | Supercom vs. Fabrinet | Supercom vs. Knowles Cor | Supercom vs. Ubiquiti Networks |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |