Correlation Between Firan Technology and Satellogic

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

By analyzing existing cross correlation between Firan Technology Group and Satellogic V, you can compare the effects of market volatilities on Firan Technology and Satellogic 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 Firan Technology with a short position of Satellogic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and Satellogic.

Diversification Opportunities for Firan Technology and Satellogic

0.34

Correlation Coefficient

Firan Technology  Satellogic

Weak diversification

The 3 months correlation between Firan and Satellogic is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Satellogic V in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satellogic V and Firan Technology 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 Firan Technology Group are associated (or correlated) with Satellogic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satellogic V has no effect on the direction of Firan Technology i.e., Firan Technology and Satellogic go up and down completely randomly.

Pair Corralation between Firan Technology and Satellogic

Assuming the 90 days horizon Firan Technology is expected to generate 5.42 times less return on investment than Satellogic. But when comparing it to its historical volatility, Firan Technology Group is 3.13 times less risky than Satellogic. It trades about 0.11 of its potential returns per unit of risk. Satellogic V is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  100.00  in Satellogic V on September 4, 2024 and sell it today you would earn a total of  96.00  from holding Satellogic V or generate 96.0% return on investment over 90 days.

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

Firan Technology Group  vs.  Satellogic V

Firan Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Firan Technology Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical and fundamental indicators, Firan Technology reported solid returns over the last few months and may actually be approaching a breakup point.

Satellogic V

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Satellogic V are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Satellogic disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Firan Technology and Satellogic

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

The idea behind Firan Technology Group and Satellogic V 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.