Correlation Analysis Between FAIRFAX FINANCIAL and EURONEXT BEL-20

This module allows you to analyze existing cross correlation between FAIRFAX FINANCIAL HOLDINGS LTD and EURONEXT BEL-20. You can compare the effects of market volatilities on FAIRFAX FINANCIAL and EURONEXT BEL-20 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 FAIRFAX FINANCIAL with a short position of EURONEXT BEL-20. See also your portfolio center. Please also check ongoing floating volatility patterns of FAIRFAX FINANCIAL and EURONEXT BEL-20.
Horizon     30 Days    Login   to change
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Comparative Performance

 Predicted Return Density 
      Returns 

FAIRFAX FINANCIAL HOLDINGS LTD  vs.  EURONEXT BEL-20

 Performance (%) 
      Timeline 

Pair Volatility

Assuming 30 trading days horizon, FAIRFAX FINANCIAL is expected to generate 3.27 times less return on investment than EURONEXT BEL-20. In addition to that, FAIRFAX FINANCIAL is 1.29 times more volatile than EURONEXT BEL-20. It trades about 0.04 of its total potential returns per unit of risk. EURONEXT BEL-20 is currently generating about 0.17 per unit of volatility. If you would invest  345,420  in EURONEXT BEL-20 on October 13, 2019 and sell it today you would earn a total of  44,428  from holding EURONEXT BEL-20 or generate 12.86% return on investment over 30 days.

Pair Corralation between FAIRFAX FINANCIAL and EURONEXT BEL-20

-0.15
Time Period3 Months [change]
DirectionNegative 
StrengthInsignificant
Accuracy98.46%
ValuesDaily Returns

Diversification Opportunities for FAIRFAX FINANCIAL and EURONEXT BEL-20

FAIRFAX FINANCIAL HOLDINGS LTD diversification synergy

Good diversification

Overlapping area represents the amount of risk that can be diversified away by holding FAIRFAX FINANCIAL HOLDINGS LTD and EURONEXT BEL-20 in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on EURONEXT BEL-20 and FAIRFAX FINANCIAL 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 FAIRFAX FINANCIAL HOLDINGS LTD are associated (or correlated) with EURONEXT BEL-20. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EURONEXT BEL-20 has no effect on the direction of FAIRFAX FINANCIAL i.e. FAIRFAX FINANCIAL and EURONEXT BEL-20 go up and down completely randomly.
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