Correlation Between Funko and 025537AU5

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Can any of the company-specific risk be diversified away by investing in both Funko and 025537AU5 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 Funko and 025537AU5 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Funko Inc and AEP 3875 15 FEB 62, you can compare the effects of market volatilities on Funko and 025537AU5 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 Funko with a short position of 025537AU5. Check out your portfolio center. Please also check ongoing floating volatility patterns of Funko and 025537AU5.

Diversification Opportunities for Funko and 025537AU5

0.37
  Correlation Coefficient

Weak diversification

The 3 months correlation between Funko and 025537AU5 is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Funko Inc and AEP 3875 15 FEB 62 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEP 3875 15 and Funko 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 Funko Inc are associated (or correlated) with 025537AU5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEP 3875 15 has no effect on the direction of Funko i.e., Funko and 025537AU5 go up and down completely randomly.

Pair Corralation between Funko and 025537AU5

Given the investment horizon of 90 days Funko Inc is expected to generate 1.42 times more return on investment than 025537AU5. However, Funko is 1.42 times more volatile than AEP 3875 15 FEB 62. It trades about 0.14 of its potential returns per unit of risk. AEP 3875 15 FEB 62 is currently generating about -0.02 per unit of risk. If you would invest  656.00  in Funko Inc on September 3, 2024 and sell it today you would earn a total of  519.00  from holding Funko Inc or generate 79.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy84.93%
ValuesDaily Returns

Funko Inc  vs.  AEP 3875 15 FEB 62

 Performance 
       Timeline  
Funko Inc 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Funko Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain forward-looking signals, Funko displayed solid returns over the last few months and may actually be approaching a breakup point.
AEP 3875 15 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days AEP 3875 15 FEB 62 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for AEP 3875 15 FEB 62 investors.

Funko and 025537AU5 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Funko and 025537AU5

The main advantage of trading using opposite Funko and 025537AU5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Funko position performs unexpectedly, 025537AU5 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 025537AU5 will offset losses from the drop in 025537AU5's long position.
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The idea behind Funko Inc and AEP 3875 15 FEB 62 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.
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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 Global Correlations module to find global opportunities by holding instruments from different markets.

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