Correlation Between TOTAL GABON and Fast Retailing
Can any of the company-specific risk be diversified away by investing in both TOTAL GABON and Fast Retailing 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 TOTAL GABON and Fast Retailing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOTAL GABON and Fast Retailing Co, you can compare the effects of market volatilities on TOTAL GABON and Fast Retailing 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 TOTAL GABON with a short position of Fast Retailing. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOTAL GABON and Fast Retailing.
Diversification Opportunities for TOTAL GABON and Fast Retailing
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TOTAL and Fast is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding TOTAL GABON and Fast Retailing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fast Retailing and TOTAL GABON 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 TOTAL GABON are associated (or correlated) with Fast Retailing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fast Retailing has no effect on the direction of TOTAL GABON i.e., TOTAL GABON and Fast Retailing go up and down completely randomly.
Pair Corralation between TOTAL GABON and Fast Retailing
Assuming the 90 days trading horizon TOTAL GABON is expected to generate 1.3 times more return on investment than Fast Retailing. However, TOTAL GABON is 1.3 times more volatile than Fast Retailing Co. It trades about 0.11 of its potential returns per unit of risk. Fast Retailing Co is currently generating about 0.09 per unit of risk. If you would invest 15,550 in TOTAL GABON on September 3, 2024 and sell it today you would earn a total of 2,850 from holding TOTAL GABON or generate 18.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TOTAL GABON vs. Fast Retailing Co
Performance |
| Timeline |
| TOTAL GABON |
| Fast Retailing |
TOTAL GABON and Fast Retailing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TOTAL GABON and Fast Retailing
The main advantage of trading using opposite TOTAL GABON and Fast Retailing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOTAL GABON position performs unexpectedly, Fast Retailing 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 Fast Retailing will offset losses from the drop in Fast Retailing's long position.| TOTAL GABON vs. TOTAL BANGUN PERSAD | TOTAL GABON vs. TOTAL BANGUN PERSAD | TOTAL GABON vs. TOTAL ENERGY SERVS | TOTAL GABON vs. Anheuser Busch InBev SANV |
| Fast Retailing vs. TOTAL GABON | Fast Retailing vs. Walgreens Boots Alliance | Fast Retailing vs. Peak Resources Limited |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |