Correlation Between Stelar Metals and Finexia Financial
Can any of the company-specific risk be diversified away by investing in both Stelar Metals and Finexia Financial 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 Stelar Metals and Finexia Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stelar Metals and Finexia Financial Group, you can compare the effects of market volatilities on Stelar Metals and Finexia Financial 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 Stelar Metals with a short position of Finexia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stelar Metals and Finexia Financial.
Diversification Opportunities for Stelar Metals and Finexia Financial
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Stelar and Finexia is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Stelar Metals and Finexia Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finexia Financial and Stelar Metals 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 Stelar Metals are associated (or correlated) with Finexia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finexia Financial has no effect on the direction of Stelar Metals i.e., Stelar Metals and Finexia Financial go up and down completely randomly.
Pair Corralation between Stelar Metals and Finexia Financial
Assuming the 90 days trading horizon Stelar Metals is expected to under-perform the Finexia Financial. In addition to that, Stelar Metals is 1.13 times more volatile than Finexia Financial Group. It trades about -0.02 of its total potential returns per unit of risk. Finexia Financial Group is currently generating about 0.02 per unit of volatility. If you would invest 29.00 in Finexia Financial Group on December 4, 2024 and sell it today you would lose (1.00) from holding Finexia Financial Group or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stelar Metals vs. Finexia Financial Group
Performance |
| Timeline |
| Stelar Metals |
| Finexia Financial |
Stelar Metals and Finexia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stelar Metals and Finexia Financial
The main advantage of trading using opposite Stelar Metals and Finexia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stelar Metals position performs unexpectedly, Finexia Financial 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 Finexia Financial will offset losses from the drop in Finexia Financial's long position.| Stelar Metals vs. Duxton Broadacre Farms | ||
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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.
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