Correlation Between Fisher Paykel and Evolution Mining

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

By analyzing existing cross correlation between Fisher Paykel Healthcare and Evolution Mining, you can compare the effects of market volatilities on Fisher Paykel and Evolution Mining 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 Fisher Paykel with a short position of Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fisher Paykel and Evolution Mining.

Diversification Opportunities for Fisher Paykel and Evolution Mining

-0.77

Correlation Coefficient

Fisher Paykel  Evolution Mining

Pay attention - limited upside

The 3 months correlation between Fisher and Evolution is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Fisher Paykel Healthcare and Evolution Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining and Fisher Paykel 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 Fisher Paykel Healthcare are associated (or correlated) with Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of Fisher Paykel i.e., Fisher Paykel and Evolution Mining go up and down completely randomly.

Pair Corralation between Fisher Paykel and Evolution Mining

Assuming the 90 days trading horizon Fisher Paykel is expected to generate 2.72 times less return on investment than Evolution Mining. But when comparing it to its historical volatility, Fisher Paykel Healthcare is 1.55 times less risky than Evolution Mining. It trades about 0.04 of its potential returns per unit of risk. Evolution Mining is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  273.00  in Evolution Mining on December 2, 2024 and sell it today you would earn a total of  336.00  from holding Evolution Mining or generate 123.08% return on investment over 90 days.

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

Fisher Paykel Healthcare  vs.  Evolution Mining

Fisher Paykel Healthcare

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fisher Paykel Healthcare has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Evolution Mining

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Evolution Mining are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Evolution Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fisher Paykel and Evolution Mining

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

The idea behind Fisher Paykel Healthcare and Evolution Mining 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.