Correlation Between Science Applications and FiscalNote Holdings
Can any of the company-specific risk be diversified away by investing in both Science Applications and FiscalNote Holdings 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 Science Applications and FiscalNote Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Science Applications International and FiscalNote Holdings, you can compare the effects of market volatilities on Science Applications and FiscalNote Holdings 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 Science Applications with a short position of FiscalNote Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Science Applications and FiscalNote Holdings.
Diversification Opportunities for Science Applications and FiscalNote Holdings
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Science and FiscalNote is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Science Applications Internati and FiscalNote Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FiscalNote Holdings and Science Applications 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 Science Applications International are associated (or correlated) with FiscalNote Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FiscalNote Holdings has no effect on the direction of Science Applications i.e., Science Applications and FiscalNote Holdings go up and down completely randomly.
Pair Corralation between Science Applications and FiscalNote Holdings
Given the investment horizon of 90 days Science Applications International is expected to under-perform the FiscalNote Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Science Applications International is 1.43 times less risky than FiscalNote Holdings. The stock trades about -0.18 of its potential returns per unit of risk. The FiscalNote Holdings is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 89.00 in FiscalNote Holdings on September 2, 2024 and sell it today you would lose (2.00) from holding FiscalNote Holdings or give up 2.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Science Applications Internati vs. FiscalNote Holdings
Performance |
| Timeline |
| Science Applications |
| FiscalNote Holdings |
Science Applications and FiscalNote Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Science Applications and FiscalNote Holdings
The main advantage of trading using opposite Science Applications and FiscalNote Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Science Applications position performs unexpectedly, FiscalNote Holdings 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 FiscalNote Holdings will offset losses from the drop in FiscalNote Holdings' long position.| Science Applications vs. FiscalNote Holdings | Science Applications vs. Innodata | Science Applications vs. Aurora Innovation | Science Applications vs. Conduent |
| FiscalNote Holdings vs. Innodata | FiscalNote Holdings vs. International Business Machines | FiscalNote Holdings vs. Aurora Innovation | FiscalNote Holdings vs. BigBearai Holdings |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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