Correlation Between Praxis Impact and Fisher Investments

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

By analyzing existing cross correlation between Praxis Impact Bond and Fisher Large Cap, you can compare the effects of market volatilities on Praxis Impact and Fisher Investments 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 Praxis Impact with a short position of Fisher Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praxis Impact and Fisher Investments.

Diversification Opportunities for Praxis Impact and Fisher Investments

-0.59

Correlation Coefficient

Praxis Impact  Fisher Investments

Excellent diversification

The 3 months correlation between Praxis and Fisher is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Praxis Impact Bond and Fisher Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisher Investments and Praxis Impact 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 Praxis Impact Bond are associated (or correlated) with Fisher Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisher Investments has no effect on the direction of Praxis Impact i.e., Praxis Impact and Fisher Investments go up and down completely randomly.

Pair Corralation between Praxis Impact and Fisher Investments

Assuming the 90 days horizon Praxis Impact Bond is expected to generate 0.27 times more return on investment than Fisher Investments. However, Praxis Impact Bond is 3.73 times less risky than Fisher Investments. It trades about 0.09 of its potential returns per unit of risk. Fisher Large Cap is currently generating about -0.07 per unit of risk. If you would invest  924.00  in Praxis Impact Bond on December 28, 2024 and sell it today you would earn a total of  15.00  from holding Praxis Impact Bond or generate 1.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Praxis Impact Bond  vs.  Fisher Large Cap

Praxis Impact Bond

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Praxis Impact Bond are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Praxis Impact is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fisher Investments

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fisher Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fisher Investments is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Praxis Impact and Fisher Investments

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

The idea behind Praxis Impact Bond and Fisher Large Cap 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 Transaction History module to view history of all your transactions and understand their impact on performance.