Correlation Between Filinvest REIT and Axelum Resources

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

By analyzing existing cross correlation between Filinvest REIT Corp and Axelum Resources Corp, you can compare the effects of market volatilities on Filinvest REIT and Axelum 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 Filinvest REIT with a short position of Axelum Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Filinvest REIT and Axelum Resources.

Diversification Opportunities for Filinvest REIT and Axelum Resources

0.09

Correlation Coefficient

Filinvest REIT  Axelum Resources

Significant diversification

The 3 months correlation between Filinvest and Axelum is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Filinvest REIT Corp and Axelum Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axelum Resources Corp and Filinvest REIT 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 Filinvest REIT Corp are associated (or correlated) with Axelum Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axelum Resources Corp has no effect on the direction of Filinvest REIT i.e., Filinvest REIT and Axelum Resources go up and down completely randomly.

Pair Corralation between Filinvest REIT and Axelum Resources

Assuming the 90 days trading horizon Filinvest REIT Corp is expected to generate 0.43 times more return on investment than Axelum Resources. However, Filinvest REIT Corp is 2.34 times less risky than Axelum Resources. It trades about 0.04 of its potential returns per unit of risk. Axelum Resources Corp is currently generating about 0.0 per unit of risk. If you would invest  268.00  in Filinvest REIT Corp on September 24, 2024 and sell it today you would earn a total of  18.00  from holding Filinvest REIT Corp or generate 6.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	93.9%
Values	Daily Returns

Filinvest REIT Corp  vs.  Axelum Resources Corp

Filinvest REIT Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Filinvest REIT Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, Filinvest REIT is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Axelum Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Filinvest REIT and Axelum Resources

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

The idea behind Filinvest REIT Corp and Axelum Resources Corp 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 Stocks Directory module to find actively traded stocks across global markets.