Correlation Between Veritone and Fortinet

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

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

Diversification Opportunities for Veritone and Fortinet

-0.11

Correlation Coefficient

Veritone  Fortinet

Good diversification

The 3 months correlation between Veritone and Fortinet is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Veritone and Fortinet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortinet and Veritone 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 Veritone are associated (or correlated) with Fortinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortinet has no effect on the direction of Veritone i.e., Veritone and Fortinet go up and down completely randomly.

Pair Corralation between Veritone and Fortinet

Given the investment horizon of 90 days Veritone is expected to generate 5.52 times more return on investment than Fortinet. However, Veritone is 5.52 times more volatile than Fortinet. It trades about 0.11 of its potential returns per unit of risk. Fortinet is currently generating about -0.13 per unit of risk. If you would invest  199.00  in Veritone on February 12, 2024 and sell it today you would earn a total of  116.00  from holding Veritone or generate 58.29% return on investment over 90 days.

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

Veritone  vs.  Fortinet

Veritone

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Veritone are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Veritone demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Fortinet

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fortinet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in June 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Veritone and Fortinet

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

The idea behind Veritone and Fortinet 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.