Correlation Between Eastman Kodak and Fabrinet
Can any of the company-specific risk be diversified away by investing in both Eastman Kodak and Fabrinet 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 Eastman Kodak and Fabrinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Kodak Co and Fabrinet, you can compare the effects of market volatilities on Eastman Kodak and Fabrinet 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 Eastman Kodak with a short position of Fabrinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Kodak and Fabrinet.
Diversification Opportunities for Eastman Kodak and Fabrinet
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eastman and Fabrinet is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Kodak Co and Fabrinet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fabrinet and Eastman Kodak 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 Eastman Kodak Co are associated (or correlated) with Fabrinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fabrinet has no effect on the direction of Eastman Kodak i.e., Eastman Kodak and Fabrinet go up and down completely randomly.
Pair Corralation between Eastman Kodak and Fabrinet
Given the investment horizon of 90 days Eastman Kodak is expected to generate 6.07 times less return on investment than Fabrinet. In addition to that, Eastman Kodak is 1.45 times more volatile than Fabrinet. It trades about 0.05 of its total potential returns per unit of risk. Fabrinet is currently generating about 0.42 per unit of volatility. If you would invest 22,124 in Fabrinet on October 25, 2024 and sell it today you would earn a total of 4,600 from holding Fabrinet or generate 20.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastman Kodak Co vs. Fabrinet
Performance |
| Timeline |
| Eastman Kodak |
| Fabrinet |
Eastman Kodak and Fabrinet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Kodak and Fabrinet
The main advantage of trading using opposite Eastman Kodak and Fabrinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Kodak position performs unexpectedly, Fabrinet 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 Fabrinet will offset losses from the drop in Fabrinet's long position.| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |