Correlation Between NVIDIA CDR and Fortis 1St

Can any of the company-specific risk be diversified away by investing in both NVIDIA CDR and Fortis 1St 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 NVIDIA CDR and Fortis 1St into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NVIDIA CDR and Fortis 1St Cum, you can compare the effects of market volatilities on NVIDIA CDR and Fortis 1St 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 NVIDIA CDR with a short position of Fortis 1St. Check out your portfolio center. Please also check ongoing floating volatility patterns of NVIDIA CDR and Fortis 1St.

Diversification Opportunities for NVIDIA CDR and Fortis 1St

-0.62

Correlation Coefficient

NVIDIA CDR  Fortis 1St

Excellent diversification

The 3 months correlation between NVIDIA and Fortis is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding NVIDIA CDR and Fortis 1St Cum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortis 1St Cum and NVIDIA CDR 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 NVIDIA CDR are associated (or correlated) with Fortis 1St. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortis 1St Cum has no effect on the direction of NVIDIA CDR i.e., NVIDIA CDR and Fortis 1St go up and down completely randomly.

Pair Corralation between NVIDIA CDR and Fortis 1St

Assuming the 90 days trading horizon NVIDIA CDR is expected to under-perform the Fortis 1St. In addition to that, NVIDIA CDR is 5.25 times more volatile than Fortis 1St Cum. It trades about -0.07 of its total potential returns per unit of risk. Fortis 1St Cum is currently generating about 0.1 per unit of volatility. If you would invest  2,102  in Fortis 1St Cum on December 29, 2024 and sell it today you would earn a total of  101.00  from holding Fortis 1St Cum or generate 4.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

NVIDIA CDR  vs.  Fortis 1St Cum

NVIDIA CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days NVIDIA CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Fortis 1St Cum

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fortis 1St Cum are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Fortis 1St is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with NVIDIA CDR and Fortis 1St

The main advantage of trading using opposite NVIDIA CDR and Fortis 1St positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NVIDIA CDR position performs unexpectedly, Fortis 1St 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 Fortis 1St will offset losses from the drop in Fortis 1St's long position.

The idea behind NVIDIA CDR and Fortis 1St Cum 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 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.