Correlation Between Farmers Edge and BASE
Can any of the company-specific risk be diversified away by investing in both Farmers Edge and BASE 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 Edge and BASE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Farmers Edge and BASE Inc, you can compare the effects of market volatilities on Farmers Edge and BASE 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 Edge with a short position of BASE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farmers Edge and BASE.
Diversification Opportunities for Farmers Edge and BASE
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Farmers and BASE is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Farmers Edge and BASE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASE Inc and Farmers Edge 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 Edge are associated (or correlated) with BASE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASE Inc has no effect on the direction of Farmers Edge i.e., Farmers Edge and BASE go up and down completely randomly.
Pair Corralation between Farmers Edge and BASE
If you would invest 193.00 in BASE Inc on October 20, 2024 and sell it today you would earn a total of 6.00 from holding BASE Inc or generate 3.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Farmers Edge vs. BASE Inc
Performance |
| Timeline |
| Farmers Edge |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BASE Inc |
Farmers Edge and BASE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farmers Edge and BASE
The main advantage of trading using opposite Farmers Edge and BASE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farmers Edge position performs unexpectedly, BASE 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 BASE will offset losses from the drop in BASE's long position.| Farmers Edge vs. RenoWorks Software | Farmers Edge vs. 01 Communique Laboratory | Farmers Edge vs. RESAAS Services | Farmers Edge vs. LifeSpeak |
| BASE vs. CurrentC Power | BASE vs. Agent Information Software | BASE vs. Auddia Inc | BASE vs. Maxwell Resource |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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