Correlation Between Latitude Financial and FireFly Metals
Can any of the company-specific risk be diversified away by investing in both Latitude Financial and FireFly Metals 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 Latitude Financial and FireFly Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Latitude Financial Services and FireFly Metals, you can compare the effects of market volatilities on Latitude Financial and FireFly Metals 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 Latitude Financial with a short position of FireFly Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Latitude Financial and FireFly Metals.
Diversification Opportunities for Latitude Financial and FireFly Metals
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Latitude and FireFly is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Latitude Financial Services and FireFly Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FireFly Metals and Latitude Financial 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 Latitude Financial Services are associated (or correlated) with FireFly Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FireFly Metals has no effect on the direction of Latitude Financial i.e., Latitude Financial and FireFly Metals go up and down completely randomly.
Pair Corralation between Latitude Financial and FireFly Metals
Assuming the 90 days trading horizon Latitude Financial Services is expected to generate 0.07 times more return on investment than FireFly Metals. However, Latitude Financial Services is 13.73 times less risky than FireFly Metals. It trades about 0.0 of its potential returns per unit of risk. FireFly Metals is currently generating about -0.11 per unit of risk. If you would invest 115.00 in Latitude Financial Services on October 30, 2024 and sell it today you would earn a total of 0.00 from holding Latitude Financial Services or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Latitude Financial Services vs. FireFly Metals
Performance |
| Timeline |
| Latitude Financial |
| FireFly Metals |
Latitude Financial and FireFly Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Latitude Financial and FireFly Metals
The main advantage of trading using opposite Latitude Financial and FireFly Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Latitude Financial position performs unexpectedly, FireFly Metals 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 FireFly Metals will offset losses from the drop in FireFly Metals' long position.| Latitude Financial vs. Ainsworth Game Technology | Latitude Financial vs. Cosmo Metals | Latitude Financial vs. Super Retail Group | Latitude Financial vs. Dug Technology |
| FireFly Metals vs. Spirit Telecom | FireFly Metals vs. Sky Metals | FireFly Metals vs. Hutchison Telecommunications | FireFly Metals vs. Farm Pride Foods |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance |