Correlation Between FOM Technologies and HusCompagniet

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Can any of the company-specific risk be diversified away by investing in both FOM Technologies and HusCompagniet 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 HusCompagniet 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 HusCompagniet AS, you can compare the effects of market volatilities on FOM Technologies and HusCompagniet 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 HusCompagniet. Check out your portfolio center. Please also check ongoing floating volatility patterns of FOM Technologies and HusCompagniet.

Diversification Opportunities for FOM Technologies and HusCompagniet

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between FOM and HusCompagniet is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FOM Technologies AS and HusCompagniet AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HusCompagniet AS 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 HusCompagniet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HusCompagniet AS has no effect on the direction of FOM Technologies i.e., FOM Technologies and HusCompagniet go up and down completely randomly.

Pair Corralation between FOM Technologies and HusCompagniet

If you would invest  0.00  in HusCompagniet AS on January 12, 2025 and sell it today you would earn a total of  0.00  from holding HusCompagniet AS or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy4.55%
ValuesDaily Returns

FOM Technologies AS  vs.  HusCompagniet AS

 Performance 
       Timeline  
FOM Technologies 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days FOM Technologies AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in May 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.
HusCompagniet AS 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days HusCompagniet AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

FOM Technologies and HusCompagniet Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with FOM Technologies and HusCompagniet

The main advantage of trading using opposite FOM Technologies and HusCompagniet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FOM Technologies position performs unexpectedly, HusCompagniet 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 HusCompagniet will offset losses from the drop in HusCompagniet's long position.
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The idea behind FOM Technologies AS and HusCompagniet AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

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