Correlation Between Fisher Small and Ab Small

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Fisher Small and Ab Small 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 Fisher Small and Ab Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fisher Small Cap and Ab Small Cap, you can compare the effects of market volatilities on Fisher Small and Ab Small 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 Fisher Small with a short position of Ab Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fisher Small and Ab Small.

Diversification Opportunities for Fisher Small and Ab Small

0.95
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Fisher and SCCVX is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fisher Small Cap and Ab Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Small Cap and Fisher Small 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 Fisher Small Cap are associated (or correlated) with Ab Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Small Cap has no effect on the direction of Fisher Small i.e., Fisher Small and Ab Small go up and down completely randomly.

Pair Corralation between Fisher Small and Ab Small

Assuming the 90 days horizon Fisher Small Cap is expected to generate 1.06 times more return on investment than Ab Small. However, Fisher Small is 1.06 times more volatile than Ab Small Cap. It trades about 0.05 of its potential returns per unit of risk. Ab Small Cap is currently generating about 0.04 per unit of risk. If you would invest  982.00  in Fisher Small Cap on September 12, 2024 and sell it today you would earn a total of  345.00  from holding Fisher Small Cap or generate 35.13% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Fisher Small Cap  vs.  Ab Small Cap

 Performance 
       Timeline  
Fisher Small Cap 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Fisher Small Cap are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Fisher Small may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Ab Small Cap 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Ab Small Cap are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ab Small may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Fisher Small and Ab Small Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Fisher Small and Ab Small

The main advantage of trading using opposite Fisher Small and Ab Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fisher Small position performs unexpectedly, Ab Small 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 Ab Small will offset losses from the drop in Ab Small's long position.
The idea behind Fisher Small Cap and Ab Small Cap 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.
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

Other Complementary Tools

Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Money Managers
Screen money managers from public funds and ETFs managed around the world