Correlation Between Forian and Duck Creek

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

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

Diversification Opportunities for Forian and Duck Creek

-0.01

Correlation Coefficient

Forian  Duck Creek

Good diversification

The 3 months correlation between Forian and Duck is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Forian Inc and Duck Creek Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duck Creek Technologies and Forian 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 Forian Inc are associated (or correlated) with Duck Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duck Creek Technologies has no effect on the direction of Forian i.e., Forian and Duck Creek go up and down completely randomly.

Pair Corralation between Forian and Duck Creek

If you would invest  261.00  in Forian Inc on January 20, 2024 and sell it today you would earn a total of  4.00  from holding Forian Inc or generate 1.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.81%
Values	Daily Returns

Forian Inc  vs.  Duck Creek Technologies

Forian Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Forian Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Forian is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Duck Creek Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Duck Creek Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Duck Creek is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Forian and Duck Creek

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

The idea behind Forian Inc and Duck Creek Technologies 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.