Correlation Between Firan Technology and Pentagon I
Can any of the company-specific risk be diversified away by investing in both Firan Technology and Pentagon I 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 Firan Technology and Pentagon I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firan Technology Group and Pentagon I Capital, you can compare the effects of market volatilities on Firan Technology and Pentagon I 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 Firan Technology with a short position of Pentagon I. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and Pentagon I.
Diversification Opportunities for Firan Technology and Pentagon I
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Firan and Pentagon is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Pentagon I Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pentagon I Capital and Firan Technology 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 Firan Technology Group are associated (or correlated) with Pentagon I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pentagon I Capital has no effect on the direction of Firan Technology i.e., Firan Technology and Pentagon I go up and down completely randomly.
Pair Corralation between Firan Technology and Pentagon I
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 0.15 times more return on investment than Pentagon I. However, Firan Technology Group is 6.75 times less risky than Pentagon I. It trades about 0.05 of its potential returns per unit of risk. Pentagon I Capital is currently generating about -0.14 per unit of risk. If you would invest 740.00 in Firan Technology Group on September 12, 2024 and sell it today you would earn a total of 14.00 from holding Firan Technology Group or generate 1.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firan Technology Group vs. Pentagon I Capital
Performance |
| Timeline |
| Firan Technology |
| Pentagon I Capital |
Firan Technology and Pentagon I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and Pentagon I
The main advantage of trading using opposite Firan Technology and Pentagon I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, Pentagon I 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 Pentagon I will offset losses from the drop in Pentagon I's long position.| Firan Technology vs. Hammond Power Solutions | Firan Technology vs. Questor Technology | Firan Technology vs. Vecima Networks | Firan Technology vs. Magellan Aerospace |
| Pentagon I vs. Guru Organic Energy | Pentagon I vs. Constellation Software | Pentagon I vs. Computer Modelling Group | Pentagon I vs. Richelieu Hardware |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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