Correlation Between Flgger Group and Jeudan

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

By analyzing existing cross correlation between Flgger group AS and Jeudan, you can compare the effects of market volatilities on Flgger Group and Jeudan 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 Flgger Group with a short position of Jeudan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flgger Group and Jeudan.

Diversification Opportunities for Flgger Group and Jeudan

-0.31

Correlation Coefficient

Flgger Group  Jeudan

Very good diversification

The 3 months correlation between Flgger and Jeudan is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Flgger group AS and Jeudan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeudan and Flgger Group 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 Flgger group AS are associated (or correlated) with Jeudan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeudan has no effect on the direction of Flgger Group i.e., Flgger Group and Jeudan go up and down completely randomly.

Pair Corralation between Flgger Group and Jeudan

Assuming the 90 days trading horizon Flgger group AS is expected to generate 0.99 times more return on investment than Jeudan. However, Flgger group AS is 1.01 times less risky than Jeudan. It trades about 0.0 of its potential returns per unit of risk. Jeudan is currently generating about -0.27 per unit of risk. If you would invest  33,600  in Flgger group AS on October 22, 2024 and sell it today you would lose (200.00) from holding Flgger group AS or give up 0.6% of portfolio value over 90 days.

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

Flgger group AS  vs.  Jeudan

Flgger group AS

Risk-Adjusted Performance

0 of 100

Very Weak

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

Jeudan

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jeudan has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Flgger Group and Jeudan

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

The idea behind Flgger group AS and Jeudan 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.