Correlation Between FNP Technologies and Soditech
Can any of the company-specific risk be diversified away by investing in both FNP Technologies and Soditech 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 Soditech 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 Soditech SA, you can compare the effects of market volatilities on FNP Technologies and Soditech 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 Soditech. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNP Technologies and Soditech.
Diversification Opportunities for FNP Technologies and Soditech
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FNP and Soditech is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding FNP Technologies SA and Soditech SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soditech 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 Soditech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soditech SA has no effect on the direction of FNP Technologies i.e., FNP Technologies and Soditech go up and down completely randomly.
Pair Corralation between FNP Technologies and Soditech
If you would invest 6.00 in FNP Technologies SA on August 30, 2024 and sell it today you would earn a total of 0.00 from holding FNP Technologies SA 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 |
FNP Technologies SA vs. Soditech SA
Performance |
| Timeline |
| FNP Technologies |
| Soditech SA |
FNP Technologies and Soditech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNP Technologies and Soditech
The main advantage of trading using opposite FNP Technologies and Soditech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNP Technologies position performs unexpectedly, Soditech 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 Soditech will offset losses from the drop in Soditech's long position.| FNP Technologies vs. Blockchain Group SA | FNP Technologies vs. Adocia | FNP Technologies vs. Manitou BF SA | FNP Technologies vs. Ossiam Minimum Variance |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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