Correlation Between FNP Technologies and High Co
Can any of the company-specific risk be diversified away by investing in both FNP Technologies and High Co 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 High Co 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 High Co SA, you can compare the effects of market volatilities on FNP Technologies and High Co 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 High Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNP Technologies and High Co.
Diversification Opportunities for FNP Technologies and High Co
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FNP and High is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding FNP Technologies SA and High Co SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Co SA 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 High Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Co SA has no effect on the direction of FNP Technologies i.e., FNP Technologies and High Co go up and down completely randomly.
Pair Corralation between FNP Technologies and High Co
Assuming the 90 days trading horizon FNP Technologies SA is expected to generate 3.51 times more return on investment than High Co. However, FNP Technologies is 3.51 times more volatile than High Co SA. It trades about -0.01 of its potential returns per unit of risk. High Co SA is currently generating about -0.08 per unit of risk. If you would invest 19.00 in FNP Technologies SA on September 2, 2024 and sell it today you would lose (13.00) from holding FNP Technologies SA or give up 68.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FNP Technologies SA vs. High Co SA
Performance |
| Timeline |
| FNP Technologies |
| High Co SA |
FNP Technologies and High Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNP Technologies and High Co
The main advantage of trading using opposite FNP Technologies and High Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNP Technologies position performs unexpectedly, High Co 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 High Co will offset losses from the drop in High Co's long position.| FNP Technologies vs. Manitou BF SA | FNP Technologies vs. Ossiam Minimum Variance | FNP Technologies vs. Granite 3x LVMH | FNP Technologies vs. 21Shares Polkadot ETP |
| High Co vs. Fiducial Office Solutions | High Co vs. Innelec Multimedia | High Co vs. Seche Environnem | High Co vs. Technip Energies BV |
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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