Correlation Between Fidus Investment and Golden Matrix

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

By analyzing existing cross correlation between Fidus Investment Corp and Golden Matrix Group, you can compare the effects of market volatilities on Fidus Investment and Golden Matrix 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 Fidus Investment with a short position of Golden Matrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and Golden Matrix.

Diversification Opportunities for Fidus Investment and Golden Matrix

-0.21

Correlation Coefficient

Fidus Investment  Golden Matrix

Very good diversification

The 3 months correlation between Fidus and Golden is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp and Golden Matrix Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Matrix Group and Fidus 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 Fidus Investment Corp are associated (or correlated) with Golden Matrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Matrix Group has no effect on the direction of Fidus Investment i.e., Fidus Investment and Golden Matrix go up and down completely randomly.

Pair Corralation between Fidus Investment and Golden Matrix

Given the investment horizon of 90 days Fidus Investment is expected to generate 6.33 times less return on investment than Golden Matrix. But when comparing it to its historical volatility, Fidus Investment Corp is 6.37 times less risky than Golden Matrix. It trades about 0.04 of its potential returns per unit of risk. Golden Matrix Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  204.00  in Golden Matrix Group on December 27, 2024 and sell it today you would earn a total of  6.00  from holding Golden Matrix Group or generate 2.94% return on investment over 90 days.

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

Fidus Investment Corp  vs.  Golden Matrix Group

Fidus Investment Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Fidus Investment Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Fidus Investment is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Golden Matrix Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Matrix Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile technical and fundamental indicators, Golden Matrix demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidus Investment and Golden Matrix

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

The idea behind Fidus Investment Corp and Golden Matrix Group 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.