Correlation Between AirBoss Of and First Trust

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

By analyzing existing cross correlation between AirBoss of America and First Trust S Network, you can compare the effects of market volatilities on AirBoss Of and First Trust 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 AirBoss Of with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of AirBoss Of and First Trust.

Diversification Opportunities for AirBoss Of and First Trust

-0.68

Correlation Coefficient

AirBoss Of  First Trust

Excellent diversification

The 3 months correlation between AirBoss and First is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding AirBoss of America and First Trust S Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust S and AirBoss Of 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 AirBoss of America are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust S has no effect on the direction of AirBoss Of i.e., AirBoss Of and First Trust go up and down completely randomly.

Pair Corralation between AirBoss Of and First Trust

Assuming the 90 days horizon AirBoss of America is expected to under-perform the First Trust. In addition to that, AirBoss Of is 3.86 times more volatile than First Trust S Network. It trades about -0.01 of its total potential returns per unit of risk. First Trust S Network is currently generating about 0.07 per unit of volatility. If you would invest  1,993  in First Trust S Network on October 12, 2024 and sell it today you would earn a total of  832.00  from holding First Trust S Network or generate 41.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	89.9%
Values	Daily Returns

AirBoss of America  vs.  First Trust S Network

AirBoss of America

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AirBoss of America has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile 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.

First Trust S

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in First Trust S Network are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal technical and fundamental indicators, First Trust may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with AirBoss Of and First Trust

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

The idea behind AirBoss of America and First Trust S Network 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.