Correlation Between Freedom Holding and Ingersoll Rand
Can any of the company-specific risk be diversified away by investing in both Freedom Holding and Ingersoll Rand 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 Freedom Holding and Ingersoll Rand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freedom Holding Corp and Ingersoll Rand, you can compare the effects of market volatilities on Freedom Holding and Ingersoll Rand 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 Freedom Holding with a short position of Ingersoll Rand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freedom Holding and Ingersoll Rand.
Diversification Opportunities for Freedom Holding and Ingersoll Rand
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Freedom and Ingersoll is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Freedom Holding Corp and Ingersoll Rand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingersoll Rand and Freedom Holding 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 Freedom Holding Corp are associated (or correlated) with Ingersoll Rand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingersoll Rand has no effect on the direction of Freedom Holding i.e., Freedom Holding and Ingersoll Rand go up and down completely randomly.
Pair Corralation between Freedom Holding and Ingersoll Rand
Given the investment horizon of 90 days Freedom Holding Corp is expected to generate 1.48 times more return on investment than Ingersoll Rand. However, Freedom Holding is 1.48 times more volatile than Ingersoll Rand. It trades about 0.06 of its potential returns per unit of risk. Ingersoll Rand is currently generating about 0.09 per unit of risk. If you would invest 6,317 in Freedom Holding Corp on August 23, 2024 and sell it today you would earn a total of 5,413 from holding Freedom Holding Corp or generate 85.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Freedom Holding Corp vs. Ingersoll Rand
Performance |
| Timeline |
| Freedom Holding Corp |
| Ingersoll Rand |
Freedom Holding and Ingersoll Rand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freedom Holding and Ingersoll Rand
The main advantage of trading using opposite Freedom Holding and Ingersoll Rand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freedom Holding position performs unexpectedly, Ingersoll Rand 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 Ingersoll Rand will offset losses from the drop in Ingersoll Rand's long position.| Freedom Holding vs. Evercore Partners | Freedom Holding vs. SCOR PK | Freedom Holding vs. Aquagold International | Freedom Holding vs. Small Cap Core |
| Ingersoll Rand vs. Small Cap Core | Ingersoll Rand vs. Freedom Holding Corp | Ingersoll Rand vs. Gfl Environmental Holdings | Ingersoll Rand vs. Growth Fund Of |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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