Correlation Between Active Health and Fonu2

Can any of the company-specific risk be diversified away by investing in both Active Health and Fonu2 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 Active Health and Fonu2 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Active Health Foods and Fonu2 Inc, you can compare the effects of market volatilities on Active Health and Fonu2 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 Active Health with a short position of Fonu2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Active Health and Fonu2.

Diversification Opportunities for Active Health and Fonu2

0.0

Correlation Coefficient

Active Health  Fonu2

Pay attention - limited upside

The 3 months correlation between Active and Fonu2 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Active Health Foods and Fonu2 Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fonu2 Inc and Active Health 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 Active Health Foods are associated (or correlated) with Fonu2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fonu2 Inc has no effect on the direction of Active Health i.e., Active Health and Fonu2 go up and down completely randomly.

Pair Corralation between Active Health and Fonu2

If you would invest  0.00  in Fonu2 Inc on December 28, 2024 and sell it today you would earn a total of  0.01  from holding Fonu2 Inc or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Active Health Foods  vs.  Fonu2 Inc

Active Health Foods

Risk-Adjusted Performance

Very Weak

Over the last 90 days Active Health Foods has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Active Health is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Fonu2 Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fonu2 Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Fonu2 unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Active Health and Fonu2

The main advantage of trading using opposite Active Health and Fonu2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Active Health position performs unexpectedly, Fonu2 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 Fonu2 will offset losses from the drop in Fonu2's long position.

The idea behind Active Health Foods and Fonu2 Inc 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.