Correlation Between Fonix Mobile and Guaranty Trust
Can any of the company-specific risk be diversified away by investing in both Fonix Mobile and Guaranty Trust 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 Fonix Mobile and Guaranty Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fonix Mobile plc and Guaranty Trust Holding, you can compare the effects of market volatilities on Fonix Mobile and Guaranty Trust 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 Fonix Mobile with a short position of Guaranty Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fonix Mobile and Guaranty Trust.
Diversification Opportunities for Fonix Mobile and Guaranty Trust
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fonix and Guaranty is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Fonix Mobile plc and Guaranty Trust Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guaranty Trust Holding and Fonix Mobile 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 Fonix Mobile plc are associated (or correlated) with Guaranty Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guaranty Trust Holding has no effect on the direction of Fonix Mobile i.e., Fonix Mobile and Guaranty Trust go up and down completely randomly.
Pair Corralation between Fonix Mobile and Guaranty Trust
Assuming the 90 days trading horizon Fonix Mobile plc is expected to generate 0.76 times more return on investment than Guaranty Trust. However, Fonix Mobile plc is 1.32 times less risky than Guaranty Trust. It trades about 0.03 of its potential returns per unit of risk. Guaranty Trust Holding is currently generating about 0.0 per unit of risk. If you would invest 18,920 in Fonix Mobile plc on August 26, 2024 and sell it today you would earn a total of 2,830 from holding Fonix Mobile plc or generate 14.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Fonix Mobile plc vs. Guaranty Trust Holding
Performance |
| Timeline |
| Fonix Mobile plc |
| Guaranty Trust Holding |
Fonix Mobile and Guaranty Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fonix Mobile and Guaranty Trust
The main advantage of trading using opposite Fonix Mobile and Guaranty Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fonix Mobile position performs unexpectedly, Guaranty Trust 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 Guaranty Trust will offset losses from the drop in Guaranty Trust's long position.| Fonix Mobile vs. Samsung Electronics Co | Fonix Mobile vs. Samsung Electronics Co | Fonix Mobile vs. Hyundai Motor | Fonix Mobile vs. Toyota Motor Corp |
| Guaranty Trust vs. Toyota Motor Corp | Guaranty Trust vs. SoftBank Group Corp | Guaranty Trust vs. Fannie Mae | Guaranty Trust vs. Panasonic 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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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