Correlation Between Porsche Automobile and Fisker
Can any of the company-specific risk be diversified away by investing in both Porsche Automobile and Fisker 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 Porsche Automobile and Fisker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Porsche Automobile Holding and Fisker Inc, you can compare the effects of market volatilities on Porsche Automobile and Fisker 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 Porsche Automobile with a short position of Fisker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Porsche Automobile and Fisker.
Diversification Opportunities for Porsche Automobile and Fisker
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Porsche and Fisker is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Porsche Automobile Holding and Fisker Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisker Inc and Porsche Automobile 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 Porsche Automobile Holding are associated (or correlated) with Fisker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisker Inc has no effect on the direction of Porsche Automobile i.e., Porsche Automobile and Fisker go up and down completely randomly.
Pair Corralation between Porsche Automobile and Fisker
Assuming the 90 days horizon Porsche Automobile Holding is expected to under-perform the Fisker. But the pink sheet apears to be less risky and, when comparing its historical volatility, Porsche Automobile Holding is 3.62 times less risky than Fisker. The pink sheet trades about -0.07 of its potential returns per unit of risk. The Fisker Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 570.00 in Fisker Inc on August 31, 2024 and sell it today you would earn a total of 45.00 from holding Fisker Inc or generate 7.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.31% |
| Values | Daily Returns |
Porsche Automobile Holding vs. Fisker Inc
Performance |
| Timeline |
| Porsche Automobile |
| Fisker Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Porsche Automobile and Fisker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Porsche Automobile and Fisker
The main advantage of trading using opposite Porsche Automobile and Fisker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Porsche Automobile position performs unexpectedly, Fisker 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 Fisker will offset losses from the drop in Fisker's long position.| Porsche Automobile vs. Volkswagen AG 110 | Porsche Automobile vs. Stellantis NV | Porsche Automobile vs. Toyota Motor | Porsche Automobile vs. Honda Motor Co |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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