Correlation Between FOM Technologies and Dataproces Group
Can any of the company-specific risk be diversified away by investing in both FOM Technologies and Dataproces Group 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 FOM Technologies and Dataproces Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FOM Technologies AS and Dataproces Group AS, you can compare the effects of market volatilities on FOM Technologies and Dataproces Group 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 FOM Technologies with a short position of Dataproces Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of FOM Technologies and Dataproces Group.
Diversification Opportunities for FOM Technologies and Dataproces Group
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FOM and Dataproces is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding FOM Technologies AS and Dataproces Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dataproces Group and FOM Technologies 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 FOM Technologies AS are associated (or correlated) with Dataproces Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dataproces Group has no effect on the direction of FOM Technologies i.e., FOM Technologies and Dataproces Group go up and down completely randomly.
Pair Corralation between FOM Technologies and Dataproces Group
Assuming the 90 days trading horizon FOM Technologies AS is expected to under-perform the Dataproces Group. In addition to that, FOM Technologies is 1.19 times more volatile than Dataproces Group AS. It trades about -0.46 of its total potential returns per unit of risk. Dataproces Group AS is currently generating about -0.04 per unit of volatility. If you would invest 590.00 in Dataproces Group AS on August 29, 2024 and sell it today you would lose (25.00) from holding Dataproces Group AS or give up 4.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FOM Technologies AS vs. Dataproces Group AS
Performance |
| Timeline |
| FOM Technologies |
| Dataproces Group |
FOM Technologies and Dataproces Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FOM Technologies and Dataproces Group
The main advantage of trading using opposite FOM Technologies and Dataproces Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FOM Technologies position performs unexpectedly, Dataproces Group 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 Dataproces Group will offset losses from the drop in Dataproces Group's long position.| FOM Technologies vs. cBrain AS | FOM Technologies vs. Penneo AS | FOM Technologies vs. Shape Robotics AS | FOM Technologies vs. ALK Abell AS |
| Dataproces Group vs. Penneo AS | Dataproces Group vs. Bactiquant AS | Dataproces Group vs. cBrain AS | Dataproces Group vs. FOM Technologies AS |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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