Correlation Between X FAB and Pinterest
Can any of the company-specific risk be diversified away by investing in both X FAB and Pinterest 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 X FAB and Pinterest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Pinterest, you can compare the effects of market volatilities on X FAB and Pinterest 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 X FAB with a short position of Pinterest. Check out your portfolio center. Please also check ongoing floating volatility patterns of X FAB and Pinterest.
Diversification Opportunities for X FAB and Pinterest
Weak diversification
The 3 months correlation between XFABF and Pinterest is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Pinterest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinterest and X FAB 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 X FAB Silicon Foundries are associated (or correlated) with Pinterest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinterest has no effect on the direction of X FAB i.e., X FAB and Pinterest go up and down completely randomly.
Pair Corralation between X FAB and Pinterest
Assuming the 90 days horizon X FAB Silicon Foundries is expected to under-perform the Pinterest. But the pink sheet apears to be less risky and, when comparing its historical volatility, X FAB Silicon Foundries is 1.17 times less risky than Pinterest. The pink sheet trades about -0.29 of its potential returns per unit of risk. The Pinterest is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 3,259 in Pinterest on August 31, 2024 and sell it today you would lose (227.00) from holding Pinterest or give up 6.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Pinterest
Performance |
| Timeline |
| X FAB Silicon |
X FAB and Pinterest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X FAB and Pinterest
The main advantage of trading using opposite X FAB and Pinterest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X FAB position performs unexpectedly, Pinterest 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 Pinterest will offset losses from the drop in Pinterest's long position.| X FAB vs. NVIDIA | X FAB vs. Intel | X FAB vs. Taiwan Semiconductor Manufacturing | X FAB vs. Marvell Technology Group |
| Pinterest vs. Twilio Inc | Pinterest vs. Meta Platforms | Pinterest vs. Alphabet Inc Class C | Pinterest vs. Alphabet Inc Class A |
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 CEOs Directory module to screen CEOs from public companies around the world.
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