Correlation Between Forrester Research and FTI Consulting
Can any of the company-specific risk be diversified away by investing in both Forrester Research and FTI Consulting 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 Forrester Research and FTI Consulting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forrester Research and FTI Consulting, you can compare the effects of market volatilities on Forrester Research and FTI Consulting 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 Forrester Research with a short position of FTI Consulting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forrester Research and FTI Consulting.
Diversification Opportunities for Forrester Research and FTI Consulting
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Forrester and FTI is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Forrester Research and FTI Consulting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTI Consulting and Forrester Research 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 Forrester Research are associated (or correlated) with FTI Consulting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FTI Consulting has no effect on the direction of Forrester Research i.e., Forrester Research and FTI Consulting go up and down completely randomly.
Pair Corralation between Forrester Research and FTI Consulting
Given the investment horizon of 90 days Forrester Research is expected to generate 1.92 times more return on investment than FTI Consulting. However, Forrester Research is 1.92 times more volatile than FTI Consulting. It trades about 0.25 of its potential returns per unit of risk. FTI Consulting is currently generating about 0.08 per unit of risk. If you would invest 1,486 in Forrester Research on August 27, 2024 and sell it today you would earn a total of 185.00 from holding Forrester Research or generate 12.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forrester Research vs. FTI Consulting
Performance |
| Timeline |
| Forrester Research |
| FTI Consulting |
Forrester Research and FTI Consulting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forrester Research and FTI Consulting
The main advantage of trading using opposite Forrester Research and FTI Consulting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forrester Research position performs unexpectedly, FTI Consulting 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 FTI Consulting will offset losses from the drop in FTI Consulting's long position.| Forrester Research vs. Franklin Covey | Forrester Research vs. TransUnion | Forrester Research vs. ICF International | Forrester Research vs. Huron Consulting Group |
| FTI Consulting vs. Franklin Covey | FTI Consulting vs. TransUnion | FTI Consulting vs. ICF International | FTI Consulting vs. Huron Consulting 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |