Correlation Between Liberty Broadband and FANUC PUNSPADR

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

By analyzing existing cross correlation between Liberty Broadband and FANUC PUNSPADR 110, you can compare the effects of market volatilities on Liberty Broadband and FANUC PUNSPADR 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 Liberty Broadband with a short position of FANUC PUNSPADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Broadband and FANUC PUNSPADR.

Diversification Opportunities for Liberty Broadband and FANUC PUNSPADR

-0.27

Correlation Coefficient

Liberty Broadband  FANUC PUNSPADR

Very good diversification

The 3 months correlation between Liberty and FANUC is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband and FANUC PUNSPADR 110 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FANUC PUNSPADR 110 and Liberty Broadband 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 Liberty Broadband are associated (or correlated) with FANUC PUNSPADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FANUC PUNSPADR 110 has no effect on the direction of Liberty Broadband i.e., Liberty Broadband and FANUC PUNSPADR go up and down completely randomly.

Pair Corralation between Liberty Broadband and FANUC PUNSPADR

Assuming the 90 days horizon Liberty Broadband is expected to generate 19.97 times less return on investment than FANUC PUNSPADR. In addition to that, Liberty Broadband is 1.34 times more volatile than FANUC PUNSPADR 110. It trades about 0.01 of its total potential returns per unit of risk. FANUC PUNSPADR 110 is currently generating about 0.16 per unit of volatility. If you would invest  1,150  in FANUC PUNSPADR 110 on October 23, 2024 and sell it today you would earn a total of  250.00  from holding FANUC PUNSPADR 110 or generate 21.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Liberty Broadband  vs.  FANUC PUNSPADR 110

Liberty Broadband

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Liberty Broadband has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Liberty Broadband is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

FANUC PUNSPADR 110

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in FANUC PUNSPADR 110 are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain fundamental indicators, FANUC PUNSPADR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Liberty Broadband and FANUC PUNSPADR

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

The idea behind Liberty Broadband and FANUC PUNSPADR 110 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.