Correlation Between Freedom Bank and Reitar Logtech

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

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

Diversification Opportunities for Freedom Bank and Reitar Logtech

-0.22

Correlation Coefficient

Freedom Bank  Reitar Logtech

Very good diversification

The 3 months correlation between Freedom and Reitar is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Freedom Bank of and Reitar Logtech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reitar Logtech Holdings and Freedom Bank 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 Freedom Bank of are associated (or correlated) with Reitar Logtech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reitar Logtech Holdings has no effect on the direction of Freedom Bank i.e., Freedom Bank and Reitar Logtech go up and down completely randomly.

Pair Corralation between Freedom Bank and Reitar Logtech

Given the investment horizon of 90 days Freedom Bank of is expected to under-perform the Reitar Logtech. But the otc stock apears to be less risky and, when comparing its historical volatility, Freedom Bank of is 7.35 times less risky than Reitar Logtech. The otc stock trades about -0.37 of its potential returns per unit of risk. The Reitar Logtech Holdings is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  365.00  in Reitar Logtech Holdings on October 6, 2024 and sell it today you would earn a total of  17.00  from holding Reitar Logtech Holdings or generate 4.66% return on investment over 90 days.

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

Freedom Bank of  vs.  Reitar Logtech Holdings

Freedom Bank

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Freedom Bank of has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Freedom Bank is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Reitar Logtech Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Reitar Logtech Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Reitar Logtech reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Freedom Bank and Reitar Logtech

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

The idea behind Freedom Bank of and Reitar Logtech 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.

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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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.