Correlation Between Genertec Universal and FedEx

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

By analyzing existing cross correlation between Genertec Universal Medical and FedEx, you can compare the effects of market volatilities on Genertec Universal and FedEx 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 Genertec Universal with a short position of FedEx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genertec Universal and FedEx.

Diversification Opportunities for Genertec Universal and FedEx

-0.44

Correlation Coefficient

Genertec Universal  FedEx

Very good diversification

The 3 months correlation between Genertec and FedEx is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Genertec Universal Medical and FedEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedEx and Genertec Universal 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 Genertec Universal Medical are associated (or correlated) with FedEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedEx has no effect on the direction of Genertec Universal i.e., Genertec Universal and FedEx go up and down completely randomly.

Pair Corralation between Genertec Universal and FedEx

Assuming the 90 days horizon Genertec Universal Medical is expected to generate 1.13 times more return on investment than FedEx. However, Genertec Universal is 1.13 times more volatile than FedEx. It trades about 0.05 of its potential returns per unit of risk. FedEx is currently generating about -0.13 per unit of risk. If you would invest  57.00  in Genertec Universal Medical on December 22, 2024 and sell it today you would earn a total of  4.00  from holding Genertec Universal Medical or generate 7.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	85.0%
Values	Daily Returns

Genertec Universal Medical  vs.  FedEx

Genertec Universal

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Genertec Universal Medical are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Genertec Universal may actually be approaching a critical reversion point that can send shares even higher in April 2025.

FedEx

Risk-Adjusted Performance

Very Weak

Over the last 90 days FedEx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Genertec Universal and FedEx

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

The idea behind Genertec Universal Medical and FedEx 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.