Correlation Between FIH MOBILE and FEMALE HEALTH
Can any of the company-specific risk be diversified away by investing in both FIH MOBILE and FEMALE HEALTH 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 FEMALE HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIH MOBILE and FEMALE HEALTH, you can compare the effects of market volatilities on FIH MOBILE and FEMALE HEALTH 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 FEMALE HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIH MOBILE and FEMALE HEALTH.
Diversification Opportunities for FIH MOBILE and FEMALE HEALTH
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FIH and FEMALE is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding FIH MOBILE and FEMALE HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FEMALE HEALTH 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 FEMALE HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FEMALE HEALTH has no effect on the direction of FIH MOBILE i.e., FIH MOBILE and FEMALE HEALTH go up and down completely randomly.
Pair Corralation between FIH MOBILE and FEMALE HEALTH
Assuming the 90 days trading horizon FIH MOBILE is expected to under-perform the FEMALE HEALTH. But the stock apears to be less risky and, when comparing its historical volatility, FIH MOBILE is 3.09 times less risky than FEMALE HEALTH. The stock trades about -0.22 of its potential returns per unit of risk. The FEMALE HEALTH is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 71.00 in FEMALE HEALTH on November 6, 2024 and sell it today you would lose (19.00) from holding FEMALE HEALTH or give up 26.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIH MOBILE vs. FEMALE HEALTH
Performance |
| Timeline |
| FIH MOBILE |
| FEMALE HEALTH |
FIH MOBILE and FEMALE HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIH MOBILE and FEMALE HEALTH
The main advantage of trading using opposite FIH MOBILE and FEMALE HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIH MOBILE position performs unexpectedly, FEMALE HEALTH 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 FEMALE HEALTH will offset losses from the drop in FEMALE HEALTH's long position.| FIH MOBILE vs. Clearside Biomedical | FIH MOBILE vs. Focus Home Interactive | FIH MOBILE vs. Haier Smart Home | FIH MOBILE vs. HAVERTY FURNITURE A |
| FEMALE HEALTH vs. Tianjin Capital Environmental | FEMALE HEALTH vs. COREBRIDGE FINANCIAL INC | FEMALE HEALTH vs. MAANSHAN IRON H | FEMALE HEALTH vs. Discover Financial Services |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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