Correlation Between Fintech Ecosystem and East Resources

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

By analyzing existing cross correlation between Fintech Ecosystem Development and East Resources Acquisition, you can compare the effects of market volatilities on Fintech Ecosystem and East Resources 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 Fintech Ecosystem with a short position of East Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fintech Ecosystem and East Resources.

Diversification Opportunities for Fintech Ecosystem and East Resources

0.0

Correlation Coefficient

Fintech Ecosystem  East Resources

Pay attention - limited upside

The 3 months correlation between Fintech and East is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fintech Ecosystem Development and East Resources Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Resources Acqui and Fintech Ecosystem 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 Fintech Ecosystem Development are associated (or correlated) with East Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Resources Acqui has no effect on the direction of Fintech Ecosystem i.e., Fintech Ecosystem and East Resources go up and down completely randomly.

Pair Corralation between Fintech Ecosystem and East Resources

If you would invest (100.00) in East Resources Acquisition on December 29, 2024 and sell it today you would earn a total of  100.00  from holding East Resources Acquisition or generate -100.0% return on investment over 90 days.

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

Fintech Ecosystem Development  vs.  East Resources Acquisition

Fintech Ecosystem

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fintech Ecosystem Development has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Fintech Ecosystem is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

East Resources Acqui

Risk-Adjusted Performance

Very Weak

Over the last 90 days East Resources Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, East Resources is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Fintech Ecosystem and East Resources

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

The idea behind Fintech Ecosystem Development and East Resources Acquisition 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.