Correlation Between PATTIES FOODS and X-FAB Silicon
Can any of the company-specific risk be diversified away by investing in both PATTIES FOODS and X-FAB Silicon 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 PATTIES FOODS and X-FAB Silicon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PATTIES FOODS and X FAB Silicon Foundries, you can compare the effects of market volatilities on PATTIES FOODS and X-FAB Silicon 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 PATTIES FOODS with a short position of X-FAB Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of PATTIES FOODS and X-FAB Silicon.
Diversification Opportunities for PATTIES FOODS and X-FAB Silicon
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PATTIES and X-FAB is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding PATTIES FOODS and X FAB Silicon Foundries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X FAB Silicon and PATTIES FOODS 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 PATTIES FOODS are associated (or correlated) with X-FAB Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X FAB Silicon has no effect on the direction of PATTIES FOODS i.e., PATTIES FOODS and X-FAB Silicon go up and down completely randomly.
Pair Corralation between PATTIES FOODS and X-FAB Silicon
Assuming the 90 days horizon PATTIES FOODS is expected to under-perform the X-FAB Silicon. In addition to that, PATTIES FOODS is 1.47 times more volatile than X FAB Silicon Foundries. It trades about -0.07 of its total potential returns per unit of risk. X FAB Silicon Foundries is currently generating about 0.03 per unit of volatility. If you would invest 491.00 in X FAB Silicon Foundries on November 3, 2024 and sell it today you would earn a total of 5.00 from holding X FAB Silicon Foundries or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PATTIES FOODS vs. X FAB Silicon Foundries
Performance |
| Timeline |
| PATTIES FOODS |
| X FAB Silicon |
PATTIES FOODS and X-FAB Silicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PATTIES FOODS and X-FAB Silicon
The main advantage of trading using opposite PATTIES FOODS and X-FAB Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PATTIES FOODS position performs unexpectedly, X-FAB Silicon 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 X-FAB Silicon will offset losses from the drop in X-FAB Silicon's long position.| PATTIES FOODS vs. T MOBILE US | PATTIES FOODS vs. BROADSTNET LEADL 00025 | PATTIES FOODS vs. Mobilezone Holding AG | PATTIES FOODS vs. TITANIUM TRANSPORTGROUP |
| X-FAB Silicon vs. KOBE STEEL LTD | X-FAB Silicon vs. Diamyd Medical AB | X-FAB Silicon vs. MOUNT GIBSON IRON | X-FAB Silicon vs. ONWARD MEDICAL 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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