Correlation Between Procter Gamble and Fidus Investment
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Fidus Investment 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 Procter Gamble and Fidus Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Fidus Investment Corp, you can compare the effects of market volatilities on Procter Gamble and Fidus Investment 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 Procter Gamble with a short position of Fidus Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Fidus Investment.
Diversification Opportunities for Procter Gamble and Fidus Investment
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Procter and Fidus is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Fidus Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidus Investment Corp and Procter Gamble 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 Procter Gamble are associated (or correlated) with Fidus Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidus Investment Corp has no effect on the direction of Procter Gamble i.e., Procter Gamble and Fidus Investment go up and down completely randomly.
Pair Corralation between Procter Gamble and Fidus Investment
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 1.07 times less return on investment than Fidus Investment. In addition to that, Procter Gamble is 1.35 times more volatile than Fidus Investment Corp. It trades about 0.35 of its total potential returns per unit of risk. Fidus Investment Corp is currently generating about 0.51 per unit of volatility. If you would invest 1,950 in Fidus Investment Corp on September 1, 2024 and sell it today you would earn a total of 179.00 from holding Fidus Investment Corp or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. Fidus Investment Corp
Performance |
| Timeline |
| Procter Gamble |
| Fidus Investment Corp |
Procter Gamble and Fidus Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Fidus Investment
The main advantage of trading using opposite Procter Gamble and Fidus Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Fidus Investment 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 Fidus Investment will offset losses from the drop in Fidus Investment's long position.| Procter Gamble vs. Colgate Palmolive | Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Kimberly Clark | Procter Gamble vs. Estee Lauder Companies |
| Fidus Investment vs. Visa Class A | Fidus Investment vs. Diamond Hill Investment | Fidus Investment vs. Distoken Acquisition | Fidus Investment vs. Associated Capital Group |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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