Correlation Between FMC and Robix Environmental

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

By analyzing existing cross correlation between FMC Corporation and Robix Environmental Technologies, you can compare the effects of market volatilities on FMC and Robix Environmental 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 FMC with a short position of Robix Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of FMC and Robix Environmental.

Diversification Opportunities for FMC and Robix Environmental

0.0

Correlation Coefficient

FMC  Robix Environmental

Pay attention - limited upside

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

Pair Corralation between FMC and Robix Environmental

If you would invest  0.01  in Robix Environmental Technologies on December 17, 2024 and sell it today you would earn a total of  0.00  from holding Robix Environmental Technologies or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

FMC Corp.  vs.  Robix Environmental Technologi

FMC Corporation

Risk-Adjusted Performance

Very Weak

Over the last 90 days FMC Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's primary indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Robix Environmental

Risk-Adjusted Performance

Very Weak

Over the last 90 days Robix Environmental Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Robix Environmental is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with FMC and Robix Environmental

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

The idea behind FMC Corporation and Robix Environmental Technologies 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.