Correlation Between Seek and FSA
Can any of the company-specific risk be diversified away by investing in both Seek and FSA 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 Seek and FSA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seek and FSA Group, you can compare the effects of market volatilities on Seek and FSA 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 Seek with a short position of FSA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seek and FSA.
Diversification Opportunities for Seek and FSA
Excellent diversification
The 3 months correlation between Seek and FSA is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Seek and FSA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FSA Group and Seek 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 Seek are associated (or correlated) with FSA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FSA Group has no effect on the direction of Seek i.e., Seek and FSA go up and down completely randomly.
Pair Corralation between Seek and FSA
Assuming the 90 days trading horizon Seek is expected to generate 1.21 times more return on investment than FSA. However, Seek is 1.21 times more volatile than FSA Group. It trades about 0.0 of its potential returns per unit of risk. FSA Group is currently generating about -0.02 per unit of risk. If you would invest 2,538 in Seek on September 14, 2024 and sell it today you would lose (98.00) from holding Seek or give up 3.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Seek vs. FSA Group
Performance |
| Timeline |
| Seek |
| FSA Group |
Seek and FSA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seek and FSA
The main advantage of trading using opposite Seek and FSA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seek position performs unexpectedly, FSA 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 FSA will offset losses from the drop in FSA's long position.The idea behind Seek and FSA Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| FSA vs. Flagship Investments | FSA vs. Platinum Asia Investments | FSA vs. Hotel Property Investments | FSA vs. Queste Communications |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |