Correlation Between Sn Hf and Fly Play

Can any of the company-specific risk be diversified away by investing in both Sn Hf and Fly Play 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 Sn Hf and Fly Play into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sn hf and Fly Play hf, you can compare the effects of market volatilities on Sn Hf and Fly Play 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 Sn Hf with a short position of Fly Play. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sn Hf and Fly Play.

Diversification Opportunities for Sn Hf and Fly Play

-0.17

Correlation Coefficient

Sn Hf  Fly Play

Good diversification

The 3 months correlation between SYN and Fly is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Sn hf and Fly Play hf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fly Play hf and Sn Hf 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 Sn hf are associated (or correlated) with Fly Play. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fly Play hf has no effect on the direction of Sn Hf i.e., Sn Hf and Fly Play go up and down completely randomly.

Pair Corralation between Sn Hf and Fly Play

Assuming the 90 days trading horizon Sn hf is expected to under-perform the Fly Play. But the stock apears to be less risky and, when comparing its historical volatility, Sn hf is 2.82 times less risky than Fly Play. The stock trades about -0.27 of its potential returns per unit of risk. The Fly Play hf is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  105.00  in Fly Play hf on October 20, 2024 and sell it today you would earn a total of  11.00  from holding Fly Play hf or generate 10.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.44%
Values	Daily Returns

Sn hf  vs.  Fly Play hf

Sn hf

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Sn hf has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Sn Hf is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Fly Play hf

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fly Play hf are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Fly Play exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sn Hf and Fly Play

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

The idea behind Sn hf and Fly Play hf 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.