Correlation Between Firan Technology and Condor Energies

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

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

Diversification Opportunities for Firan Technology and Condor Energies

0.16

Correlation Coefficient

Firan Technology  Condor Energies

Average diversification

The 3 months correlation between Firan and Condor is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Condor Energies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Condor Energies and Firan Technology 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 Firan Technology Group are associated (or correlated) with Condor Energies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Condor Energies has no effect on the direction of Firan Technology i.e., Firan Technology and Condor Energies go up and down completely randomly.

Pair Corralation between Firan Technology and Condor Energies

Assuming the 90 days trading horizon Firan Technology is expected to generate 2.19 times less return on investment than Condor Energies. But when comparing it to its historical volatility, Firan Technology Group is 3.11 times less risky than Condor Energies. It trades about 0.12 of its potential returns per unit of risk. Condor Energies is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  34.00  in Condor Energies on October 10, 2024 and sell it today you would earn a total of  157.00  from holding Condor Energies or generate 461.76% return on investment over 90 days.

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

Firan Technology Group  vs.  Condor Energies

Firan Technology

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Firan Technology Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Firan Technology displayed solid returns over the last few months and may actually be approaching a breakup point.

Condor Energies

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Condor Energies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Condor Energies is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Firan Technology and Condor Energies

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

The idea behind Firan Technology Group and Condor Energies 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.