Correlation Between Fortress Transp and Bird Global

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

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

Diversification Opportunities for Fortress Transp and Bird Global

-0.74

Correlation Coefficient

Fortress Transp  Bird Global

Pay attention - limited upside

The 3 months correlation between Fortress and Bird is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Transp Infra and Bird Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bird Global and Fortress Transp 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 Fortress Transp Infra are associated (or correlated) with Bird Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bird Global has no effect on the direction of Fortress Transp i.e., Fortress Transp and Bird Global go up and down completely randomly.

Pair Corralation between Fortress Transp and Bird Global

Given the investment horizon of 90 days Fortress Transp Infra is expected to generate 0.21 times more return on investment than Bird Global. However, Fortress Transp Infra is 4.71 times less risky than Bird Global. It trades about 0.13 of its potential returns per unit of risk. Bird Global is currently generating about -0.05 per unit of risk. If you would invest  1,570  in Fortress Transp Infra on January 26, 2024 and sell it today you would earn a total of  5,699  from holding Fortress Transp Infra or generate 362.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	91.3%
Values	Daily Returns

Fortress Transp Infra  vs.  Bird Global

Fortress Transp Infra

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fortress Transp Infra are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Fortress Transp demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Bird Global

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Bird Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively weak fundamental indicators, Bird Global unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fortress Transp and Bird Global

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

The idea behind Fortress Transp Infra and Bird Global 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..