Correlation Between Fast Retailing and MOAB MINERALS
Can any of the company-specific risk be diversified away by investing in both Fast Retailing and MOAB MINERALS 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 Fast Retailing and MOAB MINERALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fast Retailing Co and MOAB MINERALS LTD, you can compare the effects of market volatilities on Fast Retailing and MOAB MINERALS 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 Fast Retailing with a short position of MOAB MINERALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fast Retailing and MOAB MINERALS.
Diversification Opportunities for Fast Retailing and MOAB MINERALS
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fast and MOAB is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fast Retailing Co and MOAB MINERALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOAB MINERALS LTD and Fast Retailing 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 Fast Retailing Co are associated (or correlated) with MOAB MINERALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOAB MINERALS LTD has no effect on the direction of Fast Retailing i.e., Fast Retailing and MOAB MINERALS go up and down completely randomly.
Pair Corralation between Fast Retailing and MOAB MINERALS
Assuming the 90 days trading horizon Fast Retailing Co is expected to under-perform the MOAB MINERALS. But the stock apears to be less risky and, when comparing its historical volatility, Fast Retailing Co is 30.93 times less risky than MOAB MINERALS. The stock trades about -0.07 of its potential returns per unit of risk. The MOAB MINERALS LTD is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 0.05 in MOAB MINERALS LTD on November 6, 2024 and sell it today you would earn a total of 0.00 from holding MOAB MINERALS LTD or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fast Retailing Co vs. MOAB MINERALS LTD
Performance |
| Timeline |
| Fast Retailing |
| MOAB MINERALS LTD |
Fast Retailing and MOAB MINERALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fast Retailing and MOAB MINERALS
The main advantage of trading using opposite Fast Retailing and MOAB MINERALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fast Retailing position performs unexpectedly, MOAB MINERALS 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 MOAB MINERALS will offset losses from the drop in MOAB MINERALS's long position.| Fast Retailing vs. MTY Food Group | Fast Retailing vs. Performance Food Group | Fast Retailing vs. United Natural Foods | Fast Retailing vs. CarsalesCom |
| MOAB MINERALS vs. Calibre Mining Corp | MOAB MINERALS vs. MCEWEN MINING INC | MOAB MINERALS vs. DISTRICT METALS | MOAB MINERALS vs. Zijin Mining 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.
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