Federal National Mortgage Stock Volatility
| FNMFM Stock | USD 15.25 1.25 8.93% |
Federal National is moderately volatile given 3 months investment horizon. Federal National Mortgage secures Sharpe Ratio (or Efficiency) of 0.2, which denotes the company had a 0.2% return per unit of risk over the last 3 months. We were able to analyze and collect data for twenty-nine different technical indicators, which can help you to evaluate if expected returns of 1.96% are justified by taking the suggested risk. Use Federal National Mean Deviation of 4.29, coefficient of variation of 476.96, and Downside Deviation of 7.32 to evaluate company specific risk that cannot be diversified away. Key indicators related to Federal National's volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
Federal National Pink Sheet volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Federal daily returns, and it is calculated using variance and standard deviation. We also use Federal's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Federal National volatility.
Federal |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Federal National can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Federal National at lower prices. For example, an investor can purchase Federal stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Federal National's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving together with Federal Pink Sheet
| 0.99 | FMCCT | Federal Home Loan | PairCorr |
| 0.76 | COOP | Mr Cooper Group | PairCorr |
| 0.99 | FNMAS | Federal National Mortgage | PairCorr |
| 0.99 | FNMAT | Federal National Mortgage | PairCorr |
| 0.99 | FNMFN | Federal National Mortgage | PairCorr |
| 0.98 | FNMAN | Federal National Mortgage | PairCorr |
Moving against Federal Pink Sheet
| 0.81 | RKT | Rocket Companies | PairCorr |
| 0.72 | UWMC | UWM Holdings Corp Sell-off Trend | PairCorr |
| 0.45 | 871829BH9 | SYSCO P 445 | PairCorr |
Federal National Market Sensitivity And Downside Risk
Federal National's beta coefficient measures the volatility of Federal pink sheet compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Federal pink sheet's returns against your selected market. In other words, Federal National's beta of 6.97 provides an investor with an approximation of how much risk Federal National pink sheet can potentially add to one of your existing portfolios. Federal National Mortgage is displaying above-average volatility over the selected time horizon. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Federal National's pink sheet risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Federal National's pink sheet price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Federal National Mortgage Demand TrendCheck current 90 days Federal National correlation with market (Dow Jones Industrial)Federal Beta |
Federal standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 9.59 |
It is essential to understand the difference between upside risk (as represented by Federal National's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Federal National's daily returns or price. Since the actual investment returns on holding a position in federal pink sheet tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Federal National.
Federal National Mortgage Pink Sheet Volatility Analysis
Volatility refers to the frequency at which Federal National pink sheet price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Federal National's price changes. Investors will then calculate the volatility of Federal National's pink sheet to predict their future moves. A pink sheet that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A pink sheet with relatively stable price changes has low volatility. A highly volatile pink sheet is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Federal National's volatility:
Historical Volatility
This type of pink sheet volatility measures Federal National's fluctuations based on previous trends. It's commonly used to predict Federal National's future behavior based on its past. However, it cannot conclusively determine the future direction of the pink sheet.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Federal National's current market price. This means that the pink sheet will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Federal National's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Federal National Mortgage Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Federal National Projected Return Density Against Market
Assuming the 90 days horizon the pink sheet has the beta coefficient of 6.9747 . This usually indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Federal National will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Federal National or Financial Services sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Federal National's price will be affected by overall pink sheet market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Federal pink sheet's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Federal National Mortgage has an alpha of 1.1277, implying that it can generate a 1.13 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a Federal National Price Volatility?
Several factors can influence a pink sheet's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Federal National Pink Sheet Risk Measures
Assuming the 90 days horizon the coefficient of variation of Federal National is 489.12. The daily returns are distributed with a variance of 91.91 and standard deviation of 9.59. The mean deviation of Federal National Mortgage is currently at 4.41. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.76
α | Alpha over Dow Jones | 1.13 | |
β | Beta against Dow Jones | 6.97 | |
σ | Overall volatility | 9.59 | |
Ir | Information ratio | 0.20 |
Federal National Pink Sheet Return Volatility
Federal National historical daily return volatility represents how much of Federal National pink sheet's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm shows 9.5871% volatility of returns over 90 . By contrast, Dow Jones Industrial accepts 0.7777% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Federal National Volatility
Volatility is a rate at which the price of Federal National or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Federal National may increase or decrease. In other words, similar to Federal's beta indicator, it measures the risk of Federal National and helps estimate the fluctuations that may happen in a short period of time. So if prices of Federal National fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.Federal National Mortgage Association provides a source of financing for mortgages in the United States. Federal National Mortgage Association was founded in 1938 and is headquartered in Washington, the District of Columbia. Fed Natl operates under Mortgage Finance classification in the United States and is traded on OTC Exchange. It employs 7400 people.
Federal National's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Federal Pink Sheet over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Federal National's price varies over time.
3 ways to utilize Federal National's volatility to invest better
Higher Federal National's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Federal National Mortgage stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Federal National Mortgage stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Federal National Mortgage investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Federal National's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Federal National's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Federal National Investment Opportunity
Federal National Mortgage has a volatility of 9.59 and is 12.29 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of Federal National Mortgage is higher than 85 percent of all global equities and portfolios over the last 90 days. You can use Federal National Mortgage to enhance the returns of your portfolios. The pink sheet experiences a very speculative upward sentiment. The trend is possibly hyped up. Check odds of Federal National to be traded at $19.06 in 90 days.Very weak diversification
The correlation between Federal National Mortgage and DJI is 0.57 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Federal National Mortgage and DJI in the same portfolio, assuming nothing else is changed.
Federal National Additional Risk Indicators
The analysis of Federal National's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Federal National's investment and either accepting that risk or mitigating it. Along with some common measures of Federal National pink sheet's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.1694 | |||
| Market Risk Adjusted Performance | 0.2903 | |||
| Mean Deviation | 4.29 | |||
| Semi Deviation | 2.63 | |||
| Downside Deviation | 7.32 | |||
| Coefficient Of Variation | 476.96 | |||
| Standard Deviation | 9.37 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential pink sheets, we recommend comparing similar pink sheets with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Federal National Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Federal National as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Federal National's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Federal National's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Federal National Mortgage.
Other Information on Investing in Federal Pink Sheet
Federal National financial ratios help investors to determine whether Federal Pink Sheet is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Federal with respect to the benefits of owning Federal National security.