Correlation Between Bitcoin and Fourlis Holdings

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

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

Diversification Opportunities for Bitcoin and Fourlis Holdings

-0.16

Correlation Coefficient

Bitcoin  Fourlis Holdings

Good diversification

The 3 months correlation between Bitcoin and Fourlis is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and Fourlis Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fourlis Holdings and Bitcoin 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 Bitcoin are associated (or correlated) with Fourlis Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fourlis Holdings has no effect on the direction of Bitcoin i.e., Bitcoin and Fourlis Holdings go up and down completely randomly.

Pair Corralation between Bitcoin and Fourlis Holdings

Assuming the 90 days trading horizon Bitcoin is expected to under-perform the Fourlis Holdings. In addition to that, Bitcoin is 1.84 times more volatile than Fourlis Holdings SA. It trades about -0.09 of its total potential returns per unit of risk. Fourlis Holdings SA is currently generating about 0.11 per unit of volatility. If you would invest  374.00  in Fourlis Holdings SA on December 22, 2024 and sell it today you would earn a total of  31.00  from holding Fourlis Holdings SA or generate 8.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	92.31%
Values	Daily Returns

Bitcoin  vs.  Fourlis Holdings SA

Bitcoin

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bitcoin has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Bitcoin shareholders.

Fourlis Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fourlis Holdings SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Fourlis Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Bitcoin and Fourlis Holdings

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

The idea behind Bitcoin and Fourlis Holdings SA 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.