Correlation Between Computer and Fuji Media

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

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

Diversification Opportunities for Computer and Fuji Media

-0.12

Correlation Coefficient

Computer  Fuji Media

Good diversification

The 3 months correlation between Computer and Fuji is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Computer And Technologies and Fuji Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuji Media Holdings and Computer 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 Computer And Technologies are associated (or correlated) with Fuji Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuji Media Holdings has no effect on the direction of Computer i.e., Computer and Fuji Media go up and down completely randomly.

Pair Corralation between Computer and Fuji Media

Assuming the 90 days horizon Computer And Technologies is expected to under-perform the Fuji Media. But the stock apears to be less risky and, when comparing its historical volatility, Computer And Technologies is 1.09 times less risky than Fuji Media. The stock trades about -0.12 of its potential returns per unit of risk. The Fuji Media Holdings is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest  1,110  in Fuji Media Holdings on October 22, 2024 and sell it today you would lose (60.00) from holding Fuji Media Holdings or give up 5.41% of portfolio value over 90 days.

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

Computer And Technologies  vs.  Fuji Media Holdings

Computer And Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Computer And Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady 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.

Fuji Media Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Fuji Media Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Fuji Media is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Computer and Fuji Media

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

The idea behind Computer And Technologies and Fuji Media Holdings 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..