Correlation Between Farmers Merchants and Kelt Exploration
Can any of the company-specific risk be diversified away by investing in both Farmers Merchants and Kelt Exploration 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 Farmers Merchants and Kelt Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Farmers Merchants Bancorp and Kelt Exploration, you can compare the effects of market volatilities on Farmers Merchants and Kelt Exploration 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 Farmers Merchants with a short position of Kelt Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farmers Merchants and Kelt Exploration.
Diversification Opportunities for Farmers Merchants and Kelt Exploration
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Farmers and Kelt is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Farmers Merchants Bancorp and Kelt Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kelt Exploration and Farmers Merchants 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 Farmers Merchants Bancorp are associated (or correlated) with Kelt Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kelt Exploration has no effect on the direction of Farmers Merchants i.e., Farmers Merchants and Kelt Exploration go up and down completely randomly.
Pair Corralation between Farmers Merchants and Kelt Exploration
Given the investment horizon of 90 days Farmers Merchants is expected to generate 2.53 times less return on investment than Kelt Exploration. But when comparing it to its historical volatility, Farmers Merchants Bancorp is 1.59 times less risky than Kelt Exploration. It trades about 0.02 of its potential returns per unit of risk. Kelt Exploration is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 383.00 in Kelt Exploration on November 27, 2024 and sell it today you would earn a total of 77.00 from holding Kelt Exploration or generate 20.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.23% |
| Values | Daily Returns |
Farmers Merchants Bancorp vs. Kelt Exploration
Performance |
| Timeline |
| Farmers Merchants Bancorp |
| Kelt Exploration |
Farmers Merchants and Kelt Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farmers Merchants and Kelt Exploration
The main advantage of trading using opposite Farmers Merchants and Kelt Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farmers Merchants position performs unexpectedly, Kelt Exploration 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 Kelt Exploration will offset losses from the drop in Kelt Exploration's long position.| Farmers Merchants vs. PSB Holdings | Farmers Merchants vs. Eagle Financial Services | Farmers Merchants vs. National Capital Bank | Farmers Merchants vs. Community Heritage Financial |
| Kelt Exploration vs. ROK Resources | Kelt Exploration vs. PetroShale | Kelt Exploration vs. Pieridae Energy Limited | Kelt Exploration vs. Bengal Energy |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |