Correlation Between House Of and Frigoglass SAIC
Can any of the company-specific risk be diversified away by investing in both House Of and Frigoglass SAIC 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 House Of and Frigoglass SAIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The House of and Frigoglass SAIC, you can compare the effects of market volatilities on House Of and Frigoglass SAIC 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 House Of with a short position of Frigoglass SAIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of House Of and Frigoglass SAIC.
Diversification Opportunities for House Of and Frigoglass SAIC
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between House and Frigoglass is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding The House of and Frigoglass SAIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frigoglass SAIC and House Of 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 The House of are associated (or correlated) with Frigoglass SAIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frigoglass SAIC has no effect on the direction of House Of i.e., House Of and Frigoglass SAIC go up and down completely randomly.
Pair Corralation between House Of and Frigoglass SAIC
Assuming the 90 days trading horizon House Of is expected to generate 3.12 times less return on investment than Frigoglass SAIC. But when comparing it to its historical volatility, The House of is 2.15 times less risky than Frigoglass SAIC. It trades about 0.02 of its potential returns per unit of risk. Frigoglass SAIC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 44.00 in Frigoglass SAIC on October 25, 2024 and sell it today you would lose (25.00) from holding Frigoglass SAIC or give up 56.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.98% |
| Values | Daily Returns |
The House of vs. Frigoglass SAIC
Performance |
| Timeline |
| The House |
| Frigoglass SAIC |
House Of and Frigoglass SAIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with House Of and Frigoglass SAIC
The main advantage of trading using opposite House Of and Frigoglass SAIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if House Of position performs unexpectedly, Frigoglass SAIC 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 Frigoglass SAIC will offset losses from the drop in Frigoglass SAIC's long position.| House Of vs. As Commercial Industrial | House Of vs. Marfin Investment Group | House Of vs. Hellenic Telecommunications Organization | House Of vs. General Commercial Industrial |
| Frigoglass SAIC vs. Public Power | Frigoglass SAIC vs. Intralot SA Integrated | Frigoglass SAIC vs. Hellenic Petroleum SA | Frigoglass SAIC vs. Mytilineos SA |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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