Correlation Between Multilaser Industrial and Fidelity National

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

By analyzing existing cross correlation between Multilaser Industrial SA and Fidelity National Information, you can compare the effects of market volatilities on Multilaser Industrial and Fidelity National 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 Multilaser Industrial with a short position of Fidelity National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multilaser Industrial and Fidelity National.

Diversification Opportunities for Multilaser Industrial and Fidelity National

-0.64

Correlation Coefficient

Multilaser Industrial  Fidelity National

Excellent diversification

The 3 months correlation between Multilaser and Fidelity is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Multilaser Industrial SA and Fidelity National Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity National and Multilaser Industrial 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 Multilaser Industrial SA are associated (or correlated) with Fidelity National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity National has no effect on the direction of Multilaser Industrial i.e., Multilaser Industrial and Fidelity National go up and down completely randomly.

Pair Corralation between Multilaser Industrial and Fidelity National

Assuming the 90 days trading horizon Multilaser Industrial SA is expected to generate 1.46 times more return on investment than Fidelity National. However, Multilaser Industrial is 1.46 times more volatile than Fidelity National Information. It trades about 0.07 of its potential returns per unit of risk. Fidelity National Information is currently generating about -0.15 per unit of risk. If you would invest  105.00  in Multilaser Industrial SA on December 25, 2024 and sell it today you would earn a total of  11.00  from holding Multilaser Industrial SA or generate 10.48% return on investment over 90 days.

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

Multilaser Industrial SA  vs.  Fidelity National Information

Multilaser Industrial

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Multilaser Industrial SA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Multilaser Industrial unveiled solid returns over the last few months and may actually be approaching a breakup point.

Fidelity National

Risk-Adjusted Performance

Insignificant

Over the last 90 days Fidelity National Information has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Multilaser Industrial and Fidelity National

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

The idea behind Multilaser Industrial SA and Fidelity National Information 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.

Check out your portfolio center.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.