Correlation Between Fulcrum Metals and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Fulcrum Metals and Electronic Arts 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 Fulcrum Metals and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fulcrum Metals PLC and Electronic Arts, you can compare the effects of market volatilities on Fulcrum Metals and Electronic Arts 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 Fulcrum Metals with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fulcrum Metals and Electronic Arts.
Diversification Opportunities for Fulcrum Metals and Electronic Arts
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fulcrum and Electronic is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Fulcrum Metals PLC and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Fulcrum Metals 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 Fulcrum Metals PLC are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Fulcrum Metals i.e., Fulcrum Metals and Electronic Arts go up and down completely randomly.
Pair Corralation between Fulcrum Metals and Electronic Arts
Assuming the 90 days trading horizon Fulcrum Metals PLC is expected to under-perform the Electronic Arts. In addition to that, Fulcrum Metals is 2.32 times more volatile than Electronic Arts. It trades about -0.1 of its total potential returns per unit of risk. Electronic Arts is currently generating about 0.08 per unit of volatility. If you would invest 13,730 in Electronic Arts on August 25, 2024 and sell it today you would earn a total of 3,052 from holding Electronic Arts or generate 22.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Fulcrum Metals PLC vs. Electronic Arts
Performance |
| Timeline |
| Fulcrum Metals PLC |
| Electronic Arts |
Fulcrum Metals and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fulcrum Metals and Electronic Arts
The main advantage of trading using opposite Fulcrum Metals and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fulcrum Metals position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Fulcrum Metals vs. Dolly Varden Silver | Fulcrum Metals vs. Lundin Mining Corp | Fulcrum Metals vs. Zegona Communications Plc | Fulcrum Metals vs. Verizon Communications |
| Electronic Arts vs. Samsung Electronics Co | Electronic Arts vs. Samsung Electronics Co | Electronic Arts vs. Hyundai Motor | Electronic Arts vs. Toyota Motor Corp |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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