Correlation Between Sixt Leasing and Firan Technology

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

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

Diversification Opportunities for Sixt Leasing and Firan Technology

-0.76

Correlation Coefficient

Sixt Leasing  Firan Technology

Pay attention - limited upside

The 3 months correlation between Sixt and Firan is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Firan Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firan Technology and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Firan Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firan Technology has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Firan Technology go up and down completely randomly.

Pair Corralation between Sixt Leasing and Firan Technology

Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the Firan Technology. But the stock apears to be less risky and, when comparing its historical volatility, Sixt Leasing SE is 1.76 times less risky than Firan Technology. The stock trades about -0.05 of its potential returns per unit of risk. The Firan Technology Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  262.00  in Firan Technology Group on October 9, 2024 and sell it today you would earn a total of  212.00  from holding Firan Technology Group or generate 80.92% return on investment over 90 days.

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

Sixt Leasing SE  vs.  Firan Technology Group

Sixt Leasing SE

Risk-Adjusted Performance

0 of 100

Very Weak

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

Firan Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Firan Technology Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Firan Technology may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Sixt Leasing and Firan Technology

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

The idea behind Sixt Leasing SE and Firan Technology 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.