Correlation Between VIP Entertainment and Fairfax Financial
Can any of the company-specific risk be diversified away by investing in both VIP Entertainment and Fairfax 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 VIP Entertainment and Fairfax Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VIP Entertainment Technologies and Fairfax Financial Holdings, you can compare the effects of market volatilities on VIP Entertainment and Fairfax 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 VIP Entertainment with a short position of Fairfax Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of VIP Entertainment and Fairfax Financial.
Diversification Opportunities for VIP Entertainment and Fairfax Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between VIP and Fairfax is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding VIP Entertainment Technologies and Fairfax Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fairfax Financial and VIP Entertainment 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 VIP Entertainment Technologies are associated (or correlated) with Fairfax Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fairfax Financial has no effect on the direction of VIP Entertainment i.e., VIP Entertainment and Fairfax Financial go up and down completely randomly.
Pair Corralation between VIP Entertainment and Fairfax Financial
Assuming the 90 days horizon VIP Entertainment Technologies is expected to under-perform the Fairfax Financial. In addition to that, VIP Entertainment is 14.83 times more volatile than Fairfax Financial Holdings. It trades about -0.03 of its total potential returns per unit of risk. Fairfax Financial Holdings is currently generating about 0.07 per unit of volatility. If you would invest 1,968 in Fairfax Financial Holdings on October 15, 2024 and sell it today you would earn a total of 526.00 from holding Fairfax Financial Holdings or generate 26.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VIP Entertainment Technologies vs. Fairfax Financial Holdings
Performance |
| Timeline |
| VIP Entertainment |
| Fairfax Financial |
VIP Entertainment and Fairfax Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VIP Entertainment and Fairfax Financial
The main advantage of trading using opposite VIP Entertainment and Fairfax Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIP Entertainment position performs unexpectedly, Fairfax 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 Fairfax Financial will offset losses from the drop in Fairfax Financial's long position.| VIP Entertainment vs. Sparx Technology | VIP Entertainment vs. Maple Peak Investments | VIP Entertainment vs. CNJ Capital Investments | VIP Entertainment vs. InPlay Oil Corp |
| Fairfax Financial vs. Precious Metals And | Fairfax Financial vs. Canlan Ice Sports | Fairfax Financial vs. Millennium Silver Corp | Fairfax Financial vs. Talon Metals Corp |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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