Correlation Between FactSet Research and Pan Global

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

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

Diversification Opportunities for FactSet Research and Pan Global

-0.77

Correlation Coefficient

FactSet Research  Pan Global

Pay attention - limited upside

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

Pair Corralation between FactSet Research and Pan Global

Considering the 90-day investment horizon FactSet Research Systems is expected to generate 0.26 times more return on investment than Pan Global. However, FactSet Research Systems is 3.8 times less risky than Pan Global. It trades about 0.04 of its potential returns per unit of risk. Pan Global Resources is currently generating about -0.21 per unit of risk. If you would invest  47,645  in FactSet Research Systems on September 9, 2024 and sell it today you would earn a total of  352.00  from holding FactSet Research Systems or generate 0.74% return on investment over 90 days.

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

FactSet Research Systems  vs.  Pan Global Resources

FactSet Research Systems

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FactSet Research Systems are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental indicators, FactSet Research may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pan Global Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pan Global Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with FactSet Research and Pan Global

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

The idea behind FactSet Research Systems and Pan Global Resources 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.