Correlation Between Fabrinet and AT S

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

By analyzing existing cross correlation between Fabrinet and AT S Austria, you can compare the effects of market volatilities on Fabrinet and AT S 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 Fabrinet with a short position of AT S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fabrinet and AT S.

Diversification Opportunities for Fabrinet and AT S

-0.06

Correlation Coefficient

Fabrinet  AT S

Good diversification

The 3 months correlation between Fabrinet and ASAAF is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Fabrinet and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and Fabrinet 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 Fabrinet are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of Fabrinet i.e., Fabrinet and AT S go up and down completely randomly.

Pair Corralation between Fabrinet and AT S

Allowing for the 90-day total investment horizon Fabrinet is expected to generate 0.96 times more return on investment than AT S. However, Fabrinet is 1.05 times less risky than AT S. It trades about -0.01 of its potential returns per unit of risk. AT S Austria is currently generating about -0.09 per unit of risk. If you would invest  21,476  in Fabrinet on December 28, 2024 and sell it today you would lose (1,862) from holding Fabrinet or give up 8.67% of portfolio value over 90 days.

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

Fabrinet  vs.  AT S Austria

Fabrinet

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fabrinet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Fabrinet is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

AT S Austria

Risk-Adjusted Performance

Very Weak

Over the last 90 days AT S Austria has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Fabrinet and AT S

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

The idea behind Fabrinet and AT S Austria 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.

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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.