Correlation Between Foresight Autonomous and Dana
Can any of the company-specific risk be diversified away by investing in both Foresight Autonomous and Dana 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 Foresight Autonomous and Dana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foresight Autonomous Holdings and Dana Inc, you can compare the effects of market volatilities on Foresight Autonomous and Dana 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 Foresight Autonomous with a short position of Dana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foresight Autonomous and Dana.
Diversification Opportunities for Foresight Autonomous and Dana
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Foresight and Dana is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Foresight Autonomous Holdings and Dana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Inc and Foresight Autonomous 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 Foresight Autonomous Holdings are associated (or correlated) with Dana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Inc has no effect on the direction of Foresight Autonomous i.e., Foresight Autonomous and Dana go up and down completely randomly.
Pair Corralation between Foresight Autonomous and Dana
Given the investment horizon of 90 days Foresight Autonomous Holdings is expected to generate 3.26 times more return on investment than Dana. However, Foresight Autonomous is 3.26 times more volatile than Dana Inc. It trades about 0.13 of its potential returns per unit of risk. Dana Inc is currently generating about 0.36 per unit of risk. If you would invest 61.00 in Foresight Autonomous Holdings on November 1, 2024 and sell it today you would earn a total of 46.00 from holding Foresight Autonomous Holdings or generate 75.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Foresight Autonomous Holdings vs. Dana Inc
Performance |
| Timeline |
| Foresight Autonomous |
| Dana Inc |
Foresight Autonomous and Dana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Foresight Autonomous and Dana
The main advantage of trading using opposite Foresight Autonomous and Dana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foresight Autonomous position performs unexpectedly, Dana 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 Dana will offset losses from the drop in Dana's long position.| Foresight Autonomous vs. Aeva Technologies | Foresight Autonomous vs. Luminar Technologies | Foresight Autonomous vs. Hesai Group American | Foresight Autonomous vs. Aeye 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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