Correlation Between Fujitsu and FD Technologies
Can any of the company-specific risk be diversified away by investing in both Fujitsu and FD Technologies 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 Fujitsu and FD Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fujitsu Limited and FD Technologies Plc, you can compare the effects of market volatilities on Fujitsu and FD Technologies 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 Fujitsu with a short position of FD Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujitsu and FD Technologies.
Diversification Opportunities for Fujitsu and FD Technologies
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fujitsu and FDRVF is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Fujitsu Limited and FD Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FD Technologies Plc and Fujitsu 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 Fujitsu Limited are associated (or correlated) with FD Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FD Technologies Plc has no effect on the direction of Fujitsu i.e., Fujitsu and FD Technologies go up and down completely randomly.
Pair Corralation between Fujitsu and FD Technologies
Assuming the 90 days horizon Fujitsu Limited is expected to generate 3.94 times more return on investment than FD Technologies. However, Fujitsu is 3.94 times more volatile than FD Technologies Plc. It trades about 0.04 of its potential returns per unit of risk. FD Technologies Plc is currently generating about 0.06 per unit of risk. If you would invest 1,623 in Fujitsu Limited on September 25, 2024 and sell it today you would lose (43.00) from holding Fujitsu Limited or give up 2.65% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Fujitsu Limited vs. FD Technologies Plc
Performance |
Timeline |
Fujitsu Limited |
FD Technologies Plc |
Fujitsu and FD Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fujitsu and FD Technologies
The main advantage of trading using opposite Fujitsu and FD Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujitsu position performs unexpectedly, FD Technologies 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 FD Technologies will offset losses from the drop in FD Technologies' long position.Fujitsu vs. Appen Limited | Fujitsu vs. Appen Limited | Fujitsu vs. Direct Communication Solutions | Fujitsu vs. Capgemini SE ADR |
FD Technologies vs. Indra Sistemas SA | FD Technologies vs. NEC Corporation | FD Technologies vs. Fujitsu Limited | FD Technologies vs. Nomura Research Institute |
Check out your portfolio center.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.
Other Complementary Tools
CEOs Directory Screen CEOs from public companies around the world | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |