Correlation Between Itoco and FlexShopper
Can any of the company-specific risk be diversified away by investing in both Itoco and FlexShopper 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 Itoco and FlexShopper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Itoco Inc and FlexShopper, you can compare the effects of market volatilities on Itoco and FlexShopper 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 Itoco with a short position of FlexShopper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Itoco and FlexShopper.
Diversification Opportunities for Itoco and FlexShopper
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Itoco and FlexShopper is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Itoco Inc and FlexShopper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FlexShopper and Itoco 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 Itoco Inc are associated (or correlated) with FlexShopper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FlexShopper has no effect on the direction of Itoco i.e., Itoco and FlexShopper go up and down completely randomly.
Pair Corralation between Itoco and FlexShopper
Given the investment horizon of 90 days Itoco Inc is expected to generate 4.12 times more return on investment than FlexShopper. However, Itoco is 4.12 times more volatile than FlexShopper. It trades about 0.17 of its potential returns per unit of risk. FlexShopper is currently generating about -0.06 per unit of risk. If you would invest 0.14 in Itoco Inc on November 2, 2024 and sell it today you would earn a total of 0.04 from holding Itoco Inc or generate 28.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Itoco Inc vs. FlexShopper
Performance |
| Timeline |
| Itoco Inc |
| FlexShopper |
Itoco and FlexShopper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Itoco and FlexShopper
The main advantage of trading using opposite Itoco and FlexShopper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Itoco position performs unexpectedly, FlexShopper 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 FlexShopper will offset losses from the drop in FlexShopper's long position.| Itoco vs. Ocean Biomedical | Itoco vs. Cardio Diagnostics Holdings | Itoco vs. Arcus Biosciences | Itoco vs. Shattuck Labs |
| FlexShopper vs. AZN Capital Corp | FlexShopper vs. Fortress Transportation and | FlexShopper vs. Ashtead Gro | FlexShopper vs. Alta Equipment Group |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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