Correlation Between FIH MOBILE and CAIRN HOMES
Can any of the company-specific risk be diversified away by investing in both FIH MOBILE and CAIRN HOMES 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 FIH MOBILE and CAIRN HOMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIH MOBILE and CAIRN HOMES EO, you can compare the effects of market volatilities on FIH MOBILE and CAIRN HOMES 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 FIH MOBILE with a short position of CAIRN HOMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIH MOBILE and CAIRN HOMES.
Diversification Opportunities for FIH MOBILE and CAIRN HOMES
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between FIH and CAIRN is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding FIH MOBILE and CAIRN HOMES EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAIRN HOMES EO and FIH MOBILE 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 FIH MOBILE are associated (or correlated) with CAIRN HOMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAIRN HOMES EO has no effect on the direction of FIH MOBILE i.e., FIH MOBILE and CAIRN HOMES go up and down completely randomly.
Pair Corralation between FIH MOBILE and CAIRN HOMES
Assuming the 90 days trading horizon FIH MOBILE is expected to under-perform the CAIRN HOMES. In addition to that, FIH MOBILE is 1.88 times more volatile than CAIRN HOMES EO. It trades about -0.21 of its total potential returns per unit of risk. CAIRN HOMES EO is currently generating about -0.16 per unit of volatility. If you would invest 235.00 in CAIRN HOMES EO on November 3, 2024 and sell it today you would lose (21.00) from holding CAIRN HOMES EO or give up 8.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIH MOBILE vs. CAIRN HOMES EO
Performance |
| Timeline |
| FIH MOBILE |
| CAIRN HOMES EO |
FIH MOBILE and CAIRN HOMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIH MOBILE and CAIRN HOMES
The main advantage of trading using opposite FIH MOBILE and CAIRN HOMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIH MOBILE position performs unexpectedly, CAIRN HOMES 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 CAIRN HOMES will offset losses from the drop in CAIRN HOMES's long position.| FIH MOBILE vs. SIVERS SEMICONDUCTORS AB | FIH MOBILE vs. NorAm Drilling AS | FIH MOBILE vs. Volkswagen AG | FIH MOBILE vs. Darden Restaurants |
| CAIRN HOMES vs. Commercial Vehicle Group | CAIRN HOMES vs. TERADATA | CAIRN HOMES vs. Nomad Foods | CAIRN HOMES vs. Fevertree Drinks PLC |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |