Correlation Between FAST RETAIL and SOEDER SPORTFISKE
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL and SOEDER SPORTFISKE 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 RETAIL and SOEDER SPORTFISKE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FAST RETAIL ADR and SOEDER SPORTFISKE AB, you can compare the effects of market volatilities on FAST RETAIL and SOEDER SPORTFISKE 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 RETAIL with a short position of SOEDER SPORTFISKE. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and SOEDER SPORTFISKE.
Diversification Opportunities for FAST RETAIL and SOEDER SPORTFISKE
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between FAST and SOEDER is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and SOEDER SPORTFISKE AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOEDER SPORTFISKE and FAST RETAIL 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 RETAIL ADR are associated (or correlated) with SOEDER SPORTFISKE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOEDER SPORTFISKE has no effect on the direction of FAST RETAIL i.e., FAST RETAIL and SOEDER SPORTFISKE go up and down completely randomly.
Pair Corralation between FAST RETAIL and SOEDER SPORTFISKE
Assuming the 90 days trading horizon FAST RETAIL ADR is expected to under-perform the SOEDER SPORTFISKE. In addition to that, FAST RETAIL is 1.24 times more volatile than SOEDER SPORTFISKE AB. It trades about -0.23 of its total potential returns per unit of risk. SOEDER SPORTFISKE AB is currently generating about -0.07 per unit of volatility. If you would invest 219.00 in SOEDER SPORTFISKE AB on October 16, 2024 and sell it today you would lose (5.00) from holding SOEDER SPORTFISKE AB or give up 2.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FAST RETAIL ADR vs. SOEDER SPORTFISKE AB
Performance |
| Timeline |
| FAST RETAIL ADR |
| SOEDER SPORTFISKE |
FAST RETAIL and SOEDER SPORTFISKE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and SOEDER SPORTFISKE
The main advantage of trading using opposite FAST RETAIL and SOEDER SPORTFISKE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL position performs unexpectedly, SOEDER SPORTFISKE 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 SOEDER SPORTFISKE will offset losses from the drop in SOEDER SPORTFISKE's long position.| FAST RETAIL vs. Fevertree Drinks PLC | FAST RETAIL vs. United Breweries Co | FAST RETAIL vs. NEW MILLENNIUM IRON | FAST RETAIL vs. Molson Coors Beverage |
| SOEDER SPORTFISKE vs. Salesforce | SOEDER SPORTFISKE vs. FAST RETAIL ADR | SOEDER SPORTFISKE vs. TRADEDOUBLER AB SK | SOEDER SPORTFISKE vs. Coffee Holding Co |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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