Correlation Between Federal National and Rubis
Can any of the company-specific risk be diversified away by investing in both Federal National and Rubis 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 Rubis 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 Rubis, you can compare the effects of market volatilities on Federal National and Rubis 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 Rubis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal National and Rubis.
Diversification Opportunities for Federal National and Rubis
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Federal and Rubis is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Federal National Mortgage and Rubis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rubis 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 Rubis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rubis has no effect on the direction of Federal National i.e., Federal National and Rubis go up and down completely randomly.
Pair Corralation between Federal National and Rubis
If you would invest 1,420,000 in Federal National Mortgage on September 4, 2024 and sell it today you would earn a total of 1,880,000 from holding Federal National Mortgage or generate 132.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 1.19% |
| Values | Daily Returns |
Federal National Mortgage vs. Rubis
Performance |
| Timeline |
| Federal National Mortgage |
| Rubis |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Federal National and Rubis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal National and Rubis
The main advantage of trading using opposite Federal National and Rubis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal National position performs unexpectedly, Rubis 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 Rubis will offset losses from the drop in Rubis' 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 |
| Rubis vs. DCC PLC ADR | Rubis vs. Ultrapar Participacoes SA | Rubis vs. Sunoco LP | Rubis vs. HF Sinclair 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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