Correlation Between FleetPartners and ARN Media
Can any of the company-specific risk be diversified away by investing in both FleetPartners and ARN Media 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 FleetPartners and ARN Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FleetPartners Group and ARN Media Limited, you can compare the effects of market volatilities on FleetPartners and ARN Media 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 FleetPartners with a short position of ARN Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of FleetPartners and ARN Media.
Diversification Opportunities for FleetPartners and ARN Media
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FleetPartners and ARN is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding FleetPartners Group and ARN Media Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARN Media Limited and FleetPartners 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 FleetPartners Group are associated (or correlated) with ARN Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARN Media Limited has no effect on the direction of FleetPartners i.e., FleetPartners and ARN Media go up and down completely randomly.
Pair Corralation between FleetPartners and ARN Media
Assuming the 90 days trading horizon FleetPartners Group is expected to generate 0.64 times more return on investment than ARN Media. However, FleetPartners Group is 1.55 times less risky than ARN Media. It trades about 0.07 of its potential returns per unit of risk. ARN Media Limited is currently generating about -0.01 per unit of risk. If you would invest 209.00 in FleetPartners Group on August 29, 2024 and sell it today you would earn a total of 116.00 from holding FleetPartners Group or generate 55.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FleetPartners Group vs. ARN Media Limited
Performance |
| Timeline |
| FleetPartners Group |
| ARN Media Limited |
FleetPartners and ARN Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FleetPartners and ARN Media
The main advantage of trading using opposite FleetPartners and ARN Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FleetPartners position performs unexpectedly, ARN Media 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 ARN Media will offset losses from the drop in ARN Media's long position.| FleetPartners vs. EROAD | FleetPartners vs. Mirrabooka Investments | FleetPartners vs. BKI Investment | FleetPartners vs. Australian United Investment |
| ARN Media vs. M3 Mining | ARN Media vs. Oneview Healthcare PLC | ARN Media vs. Fisher Paykel Healthcare | ARN Media vs. Lendlease 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |