Correlation Between FTC SOLAR and FAIR ISAAC

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Can any of the company-specific risk be diversified away by investing in both FTC SOLAR and FAIR ISAAC 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 FTC SOLAR and FAIR ISAAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FTC SOLAR INC and FAIR ISAAC, you can compare the effects of market volatilities on FTC SOLAR and FAIR ISAAC 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 FTC SOLAR with a short position of FAIR ISAAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTC SOLAR and FAIR ISAAC.

Diversification Opportunities for FTC SOLAR and FAIR ISAAC

FTCFAIRDiversified AwayFTCFAIRDiversified Away100%
-0.4
  Correlation Coefficient

Very good diversification

The 3 months correlation between FTC and FAIR is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding FTC SOLAR INC and FAIR ISAAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FAIR ISAAC and FTC SOLAR 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 FTC SOLAR INC are associated (or correlated) with FAIR ISAAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FAIR ISAAC has no effect on the direction of FTC SOLAR i.e., FTC SOLAR and FAIR ISAAC go up and down completely randomly.

Pair Corralation between FTC SOLAR and FAIR ISAAC

Assuming the 90 days horizon FTC SOLAR INC is expected to under-perform the FAIR ISAAC. In addition to that, FTC SOLAR is 4.25 times more volatile than FAIR ISAAC. It trades about -0.03 of its total potential returns per unit of risk. FAIR ISAAC is currently generating about 0.05 per unit of volatility. If you would invest  181,250  in FAIR ISAAC on October 21, 2024 and sell it today you would earn a total of  9,650  from holding FAIR ISAAC or generate 5.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy98.36%
ValuesDaily Returns

FTC SOLAR INC  vs.  FAIR ISAAC

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -200204060
JavaScript chart by amCharts 3.21.156YK FRI
       Timeline  
FTC SOLAR INC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days FTC SOLAR INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan33.544.555.566.5
FAIR ISAAC 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in FAIR ISAAC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, FAIR ISAAC may actually be approaching a critical reversion point that can send shares even higher in February 2025.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan1,9002,0002,1002,200

FTC SOLAR and FAIR ISAAC Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-33.01-24.72-16.44-8.150.18.3516.8525.3433.84 0.010.020.030.040.050.060.07
JavaScript chart by amCharts 3.21.156YK FRI
       Returns  

Pair Trading with FTC SOLAR and FAIR ISAAC

The main advantage of trading using opposite FTC SOLAR and FAIR ISAAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTC SOLAR position performs unexpectedly, FAIR ISAAC 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 FAIR ISAAC will offset losses from the drop in FAIR ISAAC's long position.
The idea behind FTC SOLAR INC and FAIR ISAAC 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

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