Correlation Between Freeport McMoRan and OFFICE DEPOT
Can any of the company-specific risk be diversified away by investing in both Freeport McMoRan and OFFICE DEPOT 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 Freeport McMoRan and OFFICE DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freeport McMoRan and OFFICE DEPOT, you can compare the effects of market volatilities on Freeport McMoRan and OFFICE DEPOT 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 Freeport McMoRan with a short position of OFFICE DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freeport McMoRan and OFFICE DEPOT.
Diversification Opportunities for Freeport McMoRan and OFFICE DEPOT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Freeport and OFFICE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Freeport McMoRan and OFFICE DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFFICE DEPOT and Freeport McMoRan 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 Freeport McMoRan are associated (or correlated) with OFFICE DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFFICE DEPOT has no effect on the direction of Freeport McMoRan i.e., Freeport McMoRan and OFFICE DEPOT go up and down completely randomly.
Pair Corralation between Freeport McMoRan and OFFICE DEPOT
If you would invest 1,920 in OFFICE DEPOT on November 3, 2024 and sell it today you would earn a total of 0.00 from holding OFFICE DEPOT or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Freeport McMoRan vs. OFFICE DEPOT
Performance |
| Timeline |
| Freeport McMoRan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| OFFICE DEPOT |
Freeport McMoRan and OFFICE DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freeport McMoRan and OFFICE DEPOT
The main advantage of trading using opposite Freeport McMoRan and OFFICE DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freeport McMoRan position performs unexpectedly, OFFICE DEPOT 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 OFFICE DEPOT will offset losses from the drop in OFFICE DEPOT's long position.| Freeport McMoRan vs. SIEM OFFSHORE NEW | Freeport McMoRan vs. FIREWEED METALS P | Freeport McMoRan vs. SERI INDUSTRIAL EO | Freeport McMoRan vs. DISTRICT METALS |
| OFFICE DEPOT vs. Apple Inc | OFFICE DEPOT vs. Apple Inc | OFFICE DEPOT vs. Apple Inc | OFFICE DEPOT vs. Apple Inc |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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