Correlation Between TTM Technologies and Fidelity National

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

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

Diversification Opportunities for TTM Technologies and Fidelity National

0.55

Correlation Coefficient

TTM Technologies  Fidelity National

Very weak diversification

The 3 months correlation between TTM and Fidelity is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding TTM Technologies and Fidelity National Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity National and TTM Technologies 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 TTM Technologies are associated (or correlated) with Fidelity National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity National has no effect on the direction of TTM Technologies i.e., TTM Technologies and Fidelity National go up and down completely randomly.

Pair Corralation between TTM Technologies and Fidelity National

Given the investment horizon of 90 days TTM Technologies is expected to under-perform the Fidelity National. But the stock apears to be less risky and, when comparing its historical volatility, TTM Technologies is 1.29 times less risky than Fidelity National. The stock trades about -0.13 of its potential returns per unit of risk. The Fidelity National Financial is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  5,138  in Fidelity National Financial on January 25, 2024 and sell it today you would lose (53.00) from holding Fidelity National Financial or give up 1.03% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

TTM Technologies  vs.  Fidelity National Financial

TTM Technologies

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TTM Technologies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong primary indicators, TTM Technologies is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Fidelity National

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity National Financial are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Fidelity National is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with TTM Technologies and Fidelity National

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

The idea behind TTM Technologies and Fidelity National Financial 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.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.