Correlation Between Federal National and Fusion Pharm
Can any of the company-specific risk be diversified away by investing in both Federal National and Fusion Pharm 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 Federal National and Fusion Pharm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal National Mortgage and Fusion Pharm, you can compare the effects of market volatilities on Federal National and Fusion Pharm 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 Federal National with a short position of Fusion Pharm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal National and Fusion Pharm.
Diversification Opportunities for Federal National and Fusion Pharm
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Federal and Fusion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Federal National Mortgage and Fusion Pharm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fusion Pharm and Federal National 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 Federal National Mortgage are associated (or correlated) with Fusion Pharm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fusion Pharm has no effect on the direction of Federal National i.e., Federal National and Fusion Pharm go up and down completely randomly.
Pair Corralation between Federal National and Fusion Pharm
If you would invest 658,000 in Federal National Mortgage on September 4, 2024 and sell it today you would earn a total of 2,642,000 from holding Federal National Mortgage or generate 401.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Federal National Mortgage vs. Fusion Pharm
Performance |
| Timeline |
| Federal National Mortgage |
| Fusion Pharm |
Federal National and Fusion Pharm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal National and Fusion Pharm
The main advantage of trading using opposite Federal National and Fusion Pharm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal National position performs unexpectedly, Fusion Pharm 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 Fusion Pharm will offset losses from the drop in Fusion Pharm's long position.| Federal National vs. Federal Home Loan | Federal National vs. Federal Home Loan | Federal National vs. Federal Home Loan | Federal National vs. Federal Home Loan |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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