Correlation Between 654106AH6 and FactSet Research

Can any of the company-specific risk be diversified away by investing in both 654106AH6 and FactSet Research 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 654106AH6 and FactSet Research into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NIKE INC and FactSet Research Systems, you can compare the effects of market volatilities on 654106AH6 and FactSet Research 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 654106AH6 with a short position of FactSet Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of 654106AH6 and FactSet Research.

Diversification Opportunities for 654106AH6 and FactSet Research

-0.11

Correlation Coefficient

654106AH6  FactSet Research

Good diversification

The 3 months correlation between 654106AH6 and FactSet is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding NIKE INC and FactSet Research Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FactSet Research Systems and 654106AH6 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 NIKE INC are associated (or correlated) with FactSet Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FactSet Research Systems has no effect on the direction of 654106AH6 i.e., 654106AH6 and FactSet Research go up and down completely randomly.

Pair Corralation between 654106AH6 and FactSet Research

Assuming the 90 days trading horizon NIKE INC is expected to under-perform the FactSet Research. But the bond apears to be less risky and, when comparing its historical volatility, NIKE INC is 2.47 times less risky than FactSet Research. The bond trades about -0.09 of its potential returns per unit of risk. The FactSet Research Systems is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  45,307  in FactSet Research Systems on October 10, 2024 and sell it today you would earn a total of  761.00  from holding FactSet Research Systems or generate 1.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.72%
Values	Daily Returns

NIKE INC  vs.  FactSet Research Systems

654106AH6

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NIKE INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 654106AH6 is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

FactSet Research Systems

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FactSet Research Systems are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental indicators, FactSet Research is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with 654106AH6 and FactSet Research

The main advantage of trading using opposite 654106AH6 and FactSet Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 654106AH6 position performs unexpectedly, FactSet Research 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 FactSet Research will offset losses from the drop in FactSet Research's long position.

The idea behind NIKE INC and FactSet Research Systems 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..