Correlation Between Fireeye and Appian Corp

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

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

Diversification Opportunities for Fireeye and Appian Corp

0.0

Correlation Coefficient

Fireeye  Appian Corp

Pay attention - limited upside

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

Pair Corralation between Fireeye and Appian Corp

If you would invest (100.00) in Fireeye on January 25, 2024 and sell it today you would earn a total of  100.00  from holding Fireeye or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Fireeye  vs.  Appian Corp

Fireeye

Risk-Adjusted Performance

0 of 100

Very Weak

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

Appian Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Appian Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Appian Corp may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Fireeye and Appian Corp

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

The idea behind Fireeye and Appian Corp 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.