Correlation Between FIT Hon and Alpha En

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

By analyzing existing cross correlation between FIT Hon Teng and alpha En, you can compare the effects of market volatilities on FIT Hon and Alpha En 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 FIT Hon with a short position of Alpha En. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT Hon and Alpha En.

Diversification Opportunities for FIT Hon and Alpha En

0.0

Correlation Coefficient

FIT Hon  Alpha En

Pay attention - limited upside

The 3 months correlation between FIT and Alpha is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FIT Hon Teng and alpha En in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on alpha En and FIT Hon 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 FIT Hon Teng are associated (or correlated) with Alpha En. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of alpha En has no effect on the direction of FIT Hon i.e., FIT Hon and Alpha En go up and down completely randomly.

Pair Corralation between FIT Hon and Alpha En

If you would invest  33.00  in FIT Hon Teng on September 27, 2024 and sell it today you would earn a total of  7.00  from holding FIT Hon Teng or generate 21.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

FIT Hon Teng  vs.  alpha En

FIT Hon Teng

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FIT Hon Teng are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady technical and fundamental indicators, FIT Hon reported solid returns over the last few months and may actually be approaching a breakup point.

alpha En

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with FIT Hon and Alpha En

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

The idea behind FIT Hon Teng and alpha En 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.