Correlation Between TRADEGATE and FATFISH GROUP

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

By analyzing existing cross correlation between TRADEGATE and FATFISH GROUP LTD, you can compare the effects of market volatilities on TRADEGATE and FATFISH GROUP 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 TRADEGATE with a short position of FATFISH GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRADEGATE and FATFISH GROUP.

Diversification Opportunities for TRADEGATE and FATFISH GROUP

0.77

Correlation Coefficient

TRADEGATE  FATFISH GROUP

Poor diversification

The 3 months correlation between TRADEGATE and FATFISH is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding TRADEGATE and FATFISH GROUP LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FATFISH GROUP LTD and TRADEGATE 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 TRADEGATE are associated (or correlated) with FATFISH GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FATFISH GROUP LTD has no effect on the direction of TRADEGATE i.e., TRADEGATE and FATFISH GROUP go up and down completely randomly.

Pair Corralation between TRADEGATE and FATFISH GROUP

Assuming the 90 days trading horizon TRADEGATE is expected to generate 0.05 times more return on investment than FATFISH GROUP. However, TRADEGATE is 22.06 times less risky than FATFISH GROUP. It trades about -0.06 of its potential returns per unit of risk. FATFISH GROUP LTD is currently generating about -0.1 per unit of risk. If you would invest  8,950  in TRADEGATE on December 1, 2024 and sell it today you would lose (50.00) from holding TRADEGATE or give up 0.56% of portfolio value over 90 days.

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

TRADEGATE  vs.  FATFISH GROUP LTD

TRADEGATE

Risk-Adjusted Performance

Very Weak

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

FATFISH GROUP LTD

Risk-Adjusted Performance

Very Weak

Over the last 90 days FATFISH GROUP LTD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with TRADEGATE and FATFISH GROUP

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

The idea behind TRADEGATE and FATFISH GROUP LTD 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.