Correlation Between Fitbit and Fortive Corp
Can any of the company-specific risk be diversified away by investing in both Fitbit and Fortive 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 Fitbit and Fortive Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fitbit Inc and Fortive Corp, you can compare the effects of market volatilities on Fitbit and Fortive 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 Fitbit with a short position of Fortive Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fitbit and Fortive Corp.
Diversification Opportunities for Fitbit and Fortive Corp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fitbit and Fortive is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fitbit Inc and Fortive Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortive Corp and Fitbit 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 Fitbit Inc are associated (or correlated) with Fortive Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortive Corp has no effect on the direction of Fitbit i.e., Fitbit and Fortive Corp go up and down completely randomly.
Pair Corralation between Fitbit and Fortive Corp
If you would invest 7,220 in Fortive Corp on December 20, 2023 and sell it today you would earn a total of 1,302 from holding Fortive Corp or generate 18.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 2.44% |
Values | Daily Returns |
Fitbit Inc vs. Fortive Corp
Performance |
Timeline |
Fitbit Inc |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Fortive Corp |
Fitbit and Fortive Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fitbit and Fortive Corp
The main advantage of trading using opposite Fitbit and Fortive Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fitbit position performs unexpectedly, Fortive 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 Fortive Corp will offset losses from the drop in Fortive Corp's long position.Fitbit vs. NL Industries | Fitbit vs. Playtika Holding Corp | Fitbit vs. American Video Teleconferencing | Fitbit vs. Weibo Corp |
Fortive Corp vs. Sensata Technologies Holding | Fortive Corp vs. Electro Sensors | Fortive Corp vs. Energous | Fortive Corp vs. Wrap Technologies |
Check out your portfolio center.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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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