Correlation Between FNP Technologies and Granite 3x
Can any of the company-specific risk be diversified away by investing in both FNP Technologies and Granite 3x 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 FNP Technologies and Granite 3x into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FNP Technologies SA and Granite 3x LVMH, you can compare the effects of market volatilities on FNP Technologies and Granite 3x 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 FNP Technologies with a short position of Granite 3x. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNP Technologies and Granite 3x.
Diversification Opportunities for FNP Technologies and Granite 3x
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FNP and Granite is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding FNP Technologies SA and Granite 3x LVMH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite 3x LVMH and FNP Technologies 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 FNP Technologies SA are associated (or correlated) with Granite 3x. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite 3x LVMH has no effect on the direction of FNP Technologies i.e., FNP Technologies and Granite 3x go up and down completely randomly.
Pair Corralation between FNP Technologies and Granite 3x
Assuming the 90 days trading horizon FNP Technologies SA is expected to under-perform the Granite 3x. But the stock apears to be less risky and, when comparing its historical volatility, FNP Technologies SA is 1.01 times less risky than Granite 3x. The stock trades about -0.03 of its potential returns per unit of risk. The Granite 3x LVMH is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 448.00 in Granite 3x LVMH on August 26, 2024 and sell it today you would lose (293.00) from holding Granite 3x LVMH or give up 65.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 74.63% |
| Values | Daily Returns |
FNP Technologies SA vs. Granite 3x LVMH
Performance |
| Timeline |
| FNP Technologies |
| Granite 3x LVMH |
FNP Technologies and Granite 3x Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNP Technologies and Granite 3x
The main advantage of trading using opposite FNP Technologies and Granite 3x positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNP Technologies position performs unexpectedly, Granite 3x 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 Granite 3x will offset losses from the drop in Granite 3x's long position.| FNP Technologies vs. Blockchain Group SA | FNP Technologies vs. Manitou BF SA | FNP Technologies vs. Ossiam Minimum Variance | FNP Technologies vs. Granite 3x LVMH |
| Granite 3x vs. Lyxor UCITS Japan | Granite 3x vs. Lyxor UCITS Japan | Granite 3x vs. Lyxor UCITS Stoxx | Granite 3x vs. Amundi CAC 40 |
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 CEOs Directory module to screen CEOs from public companies around the world.
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