Correlation Between Flagship Investments and FSA
Can any of the company-specific risk be diversified away by investing in both Flagship Investments and FSA 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 Flagship Investments and FSA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flagship Investments and FSA Group, you can compare the effects of market volatilities on Flagship Investments and FSA 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 Flagship Investments with a short position of FSA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flagship Investments and FSA.
Diversification Opportunities for Flagship Investments and FSA
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Flagship and FSA is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Flagship Investments and FSA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FSA Group and Flagship Investments 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 Flagship Investments are associated (or correlated) with FSA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FSA Group has no effect on the direction of Flagship Investments i.e., Flagship Investments and FSA go up and down completely randomly.
Pair Corralation between Flagship Investments and FSA
Assuming the 90 days trading horizon Flagship Investments is expected to generate 1.08 times more return on investment than FSA. However, Flagship Investments is 1.08 times more volatile than FSA Group. It trades about 0.04 of its potential returns per unit of risk. FSA Group is currently generating about -0.01 per unit of risk. If you would invest 170.00 in Flagship Investments on September 14, 2024 and sell it today you would earn a total of 51.00 from holding Flagship Investments or generate 30.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flagship Investments vs. FSA Group
Performance |
| Timeline |
| Flagship Investments |
| FSA Group |
Flagship Investments and FSA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flagship Investments and FSA
The main advantage of trading using opposite Flagship Investments and FSA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flagship Investments position performs unexpectedly, FSA 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 FSA will offset losses from the drop in FSA's long position.| Flagship Investments vs. Australian Foundation Investment | Flagship Investments vs. MFF Capital Investments | Flagship Investments vs. Metrics Master Income | Flagship Investments vs. L1 Long Short |
| FSA vs. Flagship Investments | FSA vs. Platinum Asia Investments | FSA vs. Hotel Property Investments | FSA vs. Queste Communications |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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