Correlation Between Fortress Transp and Golden Heaven

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

By analyzing existing cross correlation between Fortress Transp Infra and Golden Heaven Group, you can compare the effects of market volatilities on Fortress Transp and Golden Heaven 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 Fortress Transp with a short position of Golden Heaven. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortress Transp and Golden Heaven.

Diversification Opportunities for Fortress Transp and Golden Heaven

-0.32

Correlation Coefficient

Fortress Transp  Golden Heaven

Very good diversification

The 3 months correlation between Fortress and Golden is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Transp Infra and Golden Heaven Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Heaven Group and Fortress Transp 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 Fortress Transp Infra are associated (or correlated) with Golden Heaven. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Heaven Group has no effect on the direction of Fortress Transp i.e., Fortress Transp and Golden Heaven go up and down completely randomly.

Pair Corralation between Fortress Transp and Golden Heaven

Given the investment horizon of 90 days Fortress Transp Infra is expected to under-perform the Golden Heaven. In addition to that, Fortress Transp is 2.04 times more volatile than Golden Heaven Group. It trades about -0.13 of its total potential returns per unit of risk. Golden Heaven Group is currently generating about 0.23 per unit of volatility. If you would invest  201.00  in Golden Heaven Group on October 25, 2024 and sell it today you would earn a total of  42.00  from holding Golden Heaven Group or generate 20.9% return on investment over 90 days.

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

Fortress Transp Infra  vs.  Golden Heaven Group

Fortress Transp Infra

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fortress Transp Infra has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Golden Heaven Group

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Heaven Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical indicators, Golden Heaven reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fortress Transp and Golden Heaven

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

The idea behind Fortress Transp Infra and Golden Heaven Group 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.