Correlation Between Crixus Bh3 and Fossil

Can any of the company-specific risk be diversified away by investing in both Crixus Bh3 and Fossil 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 Crixus Bh3 and Fossil into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Crixus Bh3 Acquisition and Fossil Group, you can compare the effects of market volatilities on Crixus Bh3 and Fossil 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 Crixus Bh3 with a short position of Fossil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crixus Bh3 and Fossil.

Diversification Opportunities for Crixus Bh3 and Fossil

-0.44

Correlation Coefficient

Crixus Bh3  Fossil

Very good diversification

The 3 months correlation between Crixus and Fossil is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Crixus Bh3 Acquisition and Fossil Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fossil Group and Crixus Bh3 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 Crixus Bh3 Acquisition are associated (or correlated) with Fossil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fossil Group has no effect on the direction of Crixus Bh3 i.e., Crixus Bh3 and Fossil go up and down completely randomly.

Pair Corralation between Crixus Bh3 and Fossil

Assuming the 90 days horizon Crixus Bh3 Acquisition is expected to under-perform the Fossil. But the stock apears to be less risky and, when comparing its historical volatility, Crixus Bh3 Acquisition is 10.8 times less risky than Fossil. The stock trades about -0.07 of its potential returns per unit of risk. The Fossil Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  111.00  in Fossil Group on August 31, 2024 and sell it today you would earn a total of  38.00  from holding Fossil Group or generate 34.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	53.97%
Values	Daily Returns

Crixus Bh3 Acquisition  vs.  Fossil Group

Crixus Bh3 Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crixus Bh3 Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Crixus Bh3 is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Fossil Group

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fossil Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal basic indicators, Fossil disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Crixus Bh3 and Fossil

The main advantage of trading using opposite Crixus Bh3 and Fossil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crixus Bh3 position performs unexpectedly, Fossil 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 Fossil will offset losses from the drop in Fossil's long position.

The idea behind Crixus Bh3 Acquisition and Fossil Group 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.