Correlation Between Finexia Financial and FleetPartners
Can any of the company-specific risk be diversified away by investing in both Finexia Financial and FleetPartners 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 Finexia Financial and FleetPartners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finexia Financial Group and FleetPartners Group, you can compare the effects of market volatilities on Finexia Financial and FleetPartners 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 Finexia Financial with a short position of FleetPartners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finexia Financial and FleetPartners.
Diversification Opportunities for Finexia Financial and FleetPartners
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Finexia and FleetPartners is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Finexia Financial Group and FleetPartners Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FleetPartners Group and Finexia Financial 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 Finexia Financial Group are associated (or correlated) with FleetPartners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FleetPartners Group has no effect on the direction of Finexia Financial i.e., Finexia Financial and FleetPartners go up and down completely randomly.
Pair Corralation between Finexia Financial and FleetPartners
Assuming the 90 days trading horizon Finexia Financial Group is expected to generate 1.56 times more return on investment than FleetPartners. However, Finexia Financial is 1.56 times more volatile than FleetPartners Group. It trades about 0.16 of its potential returns per unit of risk. FleetPartners Group is currently generating about 0.1 per unit of risk. If you would invest 28.00 in Finexia Financial Group on September 14, 2024 and sell it today you would earn a total of 3.00 from holding Finexia Financial Group or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Finexia Financial Group vs. FleetPartners Group
Performance |
| Timeline |
| Finexia Financial |
| FleetPartners Group |
Finexia Financial and FleetPartners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finexia Financial and FleetPartners
The main advantage of trading using opposite Finexia Financial and FleetPartners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finexia Financial position performs unexpectedly, FleetPartners 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 FleetPartners will offset losses from the drop in FleetPartners' long position.| Finexia Financial vs. Galena Mining | Finexia Financial vs. Sandon Capital Investments | Finexia Financial vs. Black Rock Mining | Finexia Financial vs. Alternative Investment Trust |
| FleetPartners vs. Credit Clear | FleetPartners vs. Bell Financial Group | FleetPartners vs. Prime Financial Group | FleetPartners vs. Finexia Financial Group |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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