Correlation Between World Houseware and Fenbo Holdings
Can any of the company-specific risk be diversified away by investing in both World Houseware and Fenbo 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 World Houseware and Fenbo Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between World Houseware Limited and Fenbo Holdings Limited, you can compare the effects of market volatilities on World Houseware and Fenbo 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 World Houseware with a short position of Fenbo Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of World Houseware and Fenbo Holdings.
Diversification Opportunities for World Houseware and Fenbo Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between World and Fenbo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding World Houseware Limited and Fenbo Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fenbo Holdings and World Houseware 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 World Houseware Limited are associated (or correlated) with Fenbo Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fenbo Holdings has no effect on the direction of World Houseware i.e., World Houseware and Fenbo Holdings go up and down completely randomly.
Pair Corralation between World Houseware and Fenbo Holdings
Assuming the 90 days horizon World Houseware Limited is expected to generate 0.55 times more return on investment than Fenbo Holdings. However, World Houseware Limited is 1.81 times less risky than Fenbo Holdings. It trades about 0.09 of its potential returns per unit of risk. Fenbo Holdings Limited is currently generating about -0.06 per unit of risk. If you would invest 3.00 in World Houseware Limited on August 24, 2024 and sell it today you would earn a total of 2.00 from holding World Houseware Limited or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
World Houseware Limited vs. Fenbo Holdings Limited
Performance |
| Timeline |
| World Houseware |
| Fenbo Holdings |
World Houseware and Fenbo Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with World Houseware and Fenbo Holdings
The main advantage of trading using opposite World Houseware and Fenbo Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if World Houseware position performs unexpectedly, Fenbo 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 Fenbo Holdings will offset losses from the drop in Fenbo Holdings' long position.| World Houseware vs. Trane Technologies plc | World Houseware vs. Carrier Global Corp | World Houseware vs. Johnson Controls International | World Houseware vs. Daikin Industries Ltd |
| Fenbo Holdings vs. SFL Corporation | Fenbo Holdings vs. United Guardian | Fenbo Holdings vs. World Houseware Limited | Fenbo Holdings vs. Eldorado Gold 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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