Correlation Between Fidelity National and LION ONE
Can any of the company-specific risk be diversified away by investing in both Fidelity National and LION ONE 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 Fidelity National and LION ONE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity National Information and LION ONE METALS, you can compare the effects of market volatilities on Fidelity National and LION ONE 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 Fidelity National with a short position of LION ONE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity National and LION ONE.
Diversification Opportunities for Fidelity National and LION ONE
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fidelity and LION is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity National Information and LION ONE METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LION ONE METALS and Fidelity National 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 Fidelity National Information are associated (or correlated) with LION ONE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LION ONE METALS has no effect on the direction of Fidelity National i.e., Fidelity National and LION ONE go up and down completely randomly.
Pair Corralation between Fidelity National and LION ONE
Assuming the 90 days trading horizon Fidelity National Information is expected to generate 0.44 times more return on investment than LION ONE. However, Fidelity National Information is 2.29 times less risky than LION ONE. It trades about -0.08 of its potential returns per unit of risk. LION ONE METALS is currently generating about -0.05 per unit of risk. If you would invest 8,240 in Fidelity National Information on September 2, 2024 and sell it today you would lose (216.00) from holding Fidelity National Information or give up 2.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity National Information vs. LION ONE METALS
Performance |
| Timeline |
| Fidelity National |
| LION ONE METALS |
Fidelity National and LION ONE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity National and LION ONE
The main advantage of trading using opposite Fidelity National and LION ONE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity National position performs unexpectedly, LION ONE 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 LION ONE will offset losses from the drop in LION ONE's long position.| Fidelity National vs. Apple Inc | Fidelity National vs. Apple Inc | Fidelity National vs. Apple Inc | Fidelity National vs. Apple Inc |
| LION ONE vs. Public Storage | LION ONE vs. NTG Nordic Transport | LION ONE vs. Automatic Data Processing | LION ONE vs. Fidelity National Information |
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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