Correlation Between FC Investment and National Atomic

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

By analyzing existing cross correlation between FC Investment Trust and National Atomic Co, you can compare the effects of market volatilities on FC Investment and National Atomic 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 FC Investment with a short position of National Atomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of FC Investment and National Atomic.

Diversification Opportunities for FC Investment and National Atomic

0.32

Correlation Coefficient

FC Investment  National Atomic

Weak diversification

The 3 months correlation between FCIT and National is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding FC Investment Trust and National Atomic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Atomic and FC Investment 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 FC Investment Trust are associated (or correlated) with National Atomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Atomic has no effect on the direction of FC Investment i.e., FC Investment and National Atomic go up and down completely randomly.

Pair Corralation between FC Investment and National Atomic

Assuming the 90 days trading horizon FC Investment Trust is expected to generate 0.56 times more return on investment than National Atomic. However, FC Investment Trust is 1.79 times less risky than National Atomic. It trades about 0.01 of its potential returns per unit of risk. National Atomic Co is currently generating about -0.04 per unit of risk. If you would invest  111,038  in FC Investment Trust on December 25, 2024 and sell it today you would earn a total of  162.00  from holding FC Investment Trust or generate 0.15% return on investment over 90 days.

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

FC Investment Trust  vs.  National Atomic Co

FC Investment Trust

Risk-Adjusted Performance

Very Weak

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

National Atomic

Risk-Adjusted Performance

Very Weak

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

Pair Trading with FC Investment and National Atomic

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

The idea behind FC Investment Trust and National Atomic Co 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.