Correlation Between Firan Technology and Xtract One
Can any of the company-specific risk be diversified away by investing in both Firan Technology and Xtract One 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 Xtract One 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 Xtract One Technologies, you can compare the effects of market volatilities on Firan Technology and Xtract One 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 Xtract One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and Xtract One.
Diversification Opportunities for Firan Technology and Xtract One
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Firan and Xtract is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Xtract One Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtract One Technologies 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 Xtract One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtract One Technologies has no effect on the direction of Firan Technology i.e., Firan Technology and Xtract One go up and down completely randomly.
Pair Corralation between Firan Technology and Xtract One
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 0.58 times more return on investment than Xtract One. However, Firan Technology Group is 1.71 times less risky than Xtract One. It trades about 0.14 of its potential returns per unit of risk. Xtract One Technologies is currently generating about 0.0 per unit of risk. If you would invest 405.00 in Firan Technology Group on September 3, 2024 and sell it today you would earn a total of 325.00 from holding Firan Technology Group or generate 80.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firan Technology Group vs. Xtract One Technologies
Performance |
| Timeline |
| Firan Technology |
| Xtract One Technologies |
Firan Technology and Xtract One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and Xtract One
The main advantage of trading using opposite Firan Technology and Xtract One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, Xtract One 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 Xtract One will offset losses from the drop in Xtract One's long position.| Firan Technology vs. Hammond Power Solutions | Firan Technology vs. Questor Technology | Firan Technology vs. Vecima Networks | Firan Technology vs. Magellan Aerospace |
| Xtract One vs. Renoworks Software | Xtract One vs. Nicola Mining | Xtract One vs. Firan Technology Group | Xtract One vs. Sparx Technology |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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