Correlation Between Fortinet and Apptech Corp
Can any of the company-specific risk be diversified away by investing in both Fortinet and Apptech Corp 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 Fortinet and Apptech Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortinet and Apptech Corp, you can compare the effects of market volatilities on Fortinet and Apptech Corp 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 Fortinet with a short position of Apptech Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortinet and Apptech Corp.
Diversification Opportunities for Fortinet and Apptech Corp
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fortinet and Apptech is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Fortinet and Apptech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apptech Corp and Fortinet 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 Fortinet are associated (or correlated) with Apptech Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apptech Corp has no effect on the direction of Fortinet i.e., Fortinet and Apptech Corp go up and down completely randomly.
Pair Corralation between Fortinet and Apptech Corp
Given the investment horizon of 90 days Fortinet is expected to generate 0.52 times more return on investment than Apptech Corp. However, Fortinet is 1.91 times less risky than Apptech Corp. It trades about 0.24 of its potential returns per unit of risk. Apptech Corp is currently generating about -0.34 per unit of risk. If you would invest 8,076 in Fortinet on August 28, 2024 and sell it today you would earn a total of 1,236 from holding Fortinet or generate 15.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortinet vs. Apptech Corp
Performance |
| Timeline |
| Fortinet |
| Apptech Corp |
Fortinet and Apptech Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortinet and Apptech Corp
The main advantage of trading using opposite Fortinet and Apptech Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortinet position performs unexpectedly, Apptech Corp 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 Apptech Corp will offset losses from the drop in Apptech Corp's long position.The idea behind Fortinet and Apptech Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Apptech Corp vs. GigaCloud Technology Class | Apptech Corp vs. Arqit Quantum | Apptech Corp vs. Telos Corp | Apptech Corp vs. Cemtrex |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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