Correlation Between Frontera and Discount Print

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

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

Diversification Opportunities for Frontera and Discount Print

0.0

Correlation Coefficient

Frontera  Discount Print

Pay attention - limited upside

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

Pair Corralation between Frontera and Discount Print

If you would invest  0.05  in Discount Print USA on October 25, 2024 and sell it today you would lose (0.03) from holding Discount Print USA or give up 60.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.51%
Values	Daily Returns

Frontera Group  vs.  Discount Print USA

Frontera Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

Discount Print USA

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Discount Print USA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly sluggish basic indicators, Discount Print demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Frontera and Discount Print

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

The idea behind Frontera Group and Discount Print USA 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.