Correlation Between Ironbark Capital and Fisher Paykel
Can any of the company-specific risk be diversified away by investing in both Ironbark Capital and Fisher Paykel 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 Ironbark Capital and Fisher Paykel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ironbark Capital and Fisher Paykel Healthcare, you can compare the effects of market volatilities on Ironbark Capital and Fisher Paykel 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 Ironbark Capital with a short position of Fisher Paykel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ironbark Capital and Fisher Paykel.
Diversification Opportunities for Ironbark Capital and Fisher Paykel
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ironbark and Fisher is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ironbark Capital and Fisher Paykel Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisher Paykel Healthcare and Ironbark Capital 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 Ironbark Capital are associated (or correlated) with Fisher Paykel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisher Paykel Healthcare has no effect on the direction of Ironbark Capital i.e., Ironbark Capital and Fisher Paykel go up and down completely randomly.
Pair Corralation between Ironbark Capital and Fisher Paykel
Assuming the 90 days trading horizon Ironbark Capital is expected to generate 30.0 times less return on investment than Fisher Paykel. But when comparing it to its historical volatility, Ironbark Capital is 1.9 times less risky than Fisher Paykel. It trades about 0.0 of its potential returns per unit of risk. Fisher Paykel Healthcare is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,282 in Fisher Paykel Healthcare on August 28, 2024 and sell it today you would earn a total of 121.00 from holding Fisher Paykel Healthcare or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ironbark Capital vs. Fisher Paykel Healthcare
Performance |
| Timeline |
| Ironbark Capital |
| Fisher Paykel Healthcare |
Ironbark Capital and Fisher Paykel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ironbark Capital and Fisher Paykel
The main advantage of trading using opposite Ironbark Capital and Fisher Paykel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ironbark Capital position performs unexpectedly, Fisher Paykel 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 Fisher Paykel will offset losses from the drop in Fisher Paykel's long position.| Ironbark Capital vs. Australian Foundation Investment | Ironbark Capital vs. GQG Partners DRC | Ironbark Capital vs. Metrics Master Income | Ironbark Capital vs. L1 Long Short |
| Fisher Paykel vs. Red Hill Iron | Fisher Paykel vs. Black Rock Mining | Fisher Paykel vs. Legacy Iron Ore | Fisher Paykel vs. Ironbark Capital |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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