Correlation Between RFM Corp and Ever Gotesco

Can any of the company-specific risk be diversified away by investing in both RFM Corp and Ever Gotesco 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 RFM Corp and Ever Gotesco into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between RFM Corp and Ever Gotesco Resources, you can compare the effects of market volatilities on RFM Corp and Ever Gotesco 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 RFM Corp with a short position of Ever Gotesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of RFM Corp and Ever Gotesco.

Diversification Opportunities for RFM Corp and Ever Gotesco

-0.55

Correlation Coefficient

RFM Corp  Ever Gotesco

Excellent diversification

The 3 months correlation between RFM and Ever is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding RFM Corp and Ever Gotesco Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ever Gotesco Resources and RFM Corp 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 RFM Corp are associated (or correlated) with Ever Gotesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ever Gotesco Resources has no effect on the direction of RFM Corp i.e., RFM Corp and Ever Gotesco go up and down completely randomly.

Pair Corralation between RFM Corp and Ever Gotesco

Assuming the 90 days trading horizon RFM Corp is expected to generate 0.64 times more return on investment than Ever Gotesco. However, RFM Corp is 1.57 times less risky than Ever Gotesco. It trades about 0.15 of its potential returns per unit of risk. Ever Gotesco Resources is currently generating about -0.12 per unit of risk. If you would invest  379.00  in RFM Corp on December 26, 2024 and sell it today you would earn a total of  41.00  from holding RFM Corp or generate 10.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	90.0%
Values	Daily Returns

RFM Corp  vs.  Ever Gotesco Resources

RFM Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in RFM Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, RFM Corp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Ever Gotesco Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ever Gotesco Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with RFM Corp and Ever Gotesco

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

The idea behind RFM Corp and Ever Gotesco Resources 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.