Correlation Between Fantagio Corp and Global Standard

Can any of the company-specific risk be diversified away by investing in both Fantagio Corp and Global Standard 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 Fantagio Corp and Global Standard into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fantagio Corp and Global Standard Technology, you can compare the effects of market volatilities on Fantagio Corp and Global Standard 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 Fantagio Corp with a short position of Global Standard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fantagio Corp and Global Standard.

Diversification Opportunities for Fantagio Corp and Global Standard

-0.35

Correlation Coefficient

Fantagio Corp  Global Standard

Very good diversification

The 3 months correlation between Fantagio and Global is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Fantagio Corp and Global Standard Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Standard Tech and Fantagio Corp 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 Fantagio Corp are associated (or correlated) with Global Standard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Standard Tech has no effect on the direction of Fantagio Corp i.e., Fantagio Corp and Global Standard go up and down completely randomly.

Pair Corralation between Fantagio Corp and Global Standard

Assuming the 90 days trading horizon Fantagio Corp is expected to under-perform the Global Standard. In addition to that, Fantagio Corp is 1.19 times more volatile than Global Standard Technology. It trades about -0.04 of its total potential returns per unit of risk. Global Standard Technology is currently generating about 0.05 per unit of volatility. If you would invest  1,085,013  in Global Standard Technology on October 23, 2024 and sell it today you would earn a total of  743,987  from holding Global Standard Technology or generate 68.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	97.1%
Values	Daily Returns

Fantagio Corp  vs.  Global Standard Technology

Fantagio Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fantagio Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Global Standard Tech

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Standard Technology are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Global Standard sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fantagio Corp and Global Standard

The main advantage of trading using opposite Fantagio Corp and Global Standard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fantagio Corp position performs unexpectedly, Global Standard 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 Global Standard will offset losses from the drop in Global Standard's long position.

The idea behind Fantagio Corp and Global Standard Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.