Correlation Between Bill and FactSet Research

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

By analyzing existing cross correlation between Bill Com Holdings and FactSet Research Systems, you can compare the effects of market volatilities on Bill and FactSet Research 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 Bill with a short position of FactSet Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bill and FactSet Research.

Diversification Opportunities for Bill and FactSet Research

0.77

Correlation Coefficient

Bill  FactSet Research

Poor diversification

The 3 months correlation between Bill and FactSet is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Bill Com Holdings and FactSet Research Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FactSet Research Systems and Bill 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 Bill Com Holdings are associated (or correlated) with FactSet Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FactSet Research Systems has no effect on the direction of Bill i.e., Bill and FactSet Research go up and down completely randomly.

Pair Corralation between Bill and FactSet Research

Given the investment horizon of 90 days Bill Com Holdings is expected to under-perform the FactSet Research. In addition to that, Bill is 5.0 times more volatile than FactSet Research Systems. It trades about -0.14 of its total potential returns per unit of risk. FactSet Research Systems is currently generating about -0.1 per unit of volatility. If you would invest  48,158  in FactSet Research Systems on December 28, 2024 and sell it today you would lose (3,235) from holding FactSet Research Systems or give up 6.72% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Bill Com Holdings  vs.  FactSet Research Systems

Bill Com Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bill Com Holdings 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 essential indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

FactSet Research Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days FactSet Research Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Bill and FactSet Research

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

The idea behind Bill Com Holdings and FactSet Research Systems 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.