Correlation Between FluenceLimited and Cheviot Financial

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Can any of the company-specific risk be diversified away by investing in both FluenceLimited and Cheviot Financial 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 FluenceLimited and Cheviot Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fluence Limited and Cheviot Financial Corp, you can compare the effects of market volatilities on FluenceLimited and Cheviot Financial 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 FluenceLimited with a short position of Cheviot Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of FluenceLimited and Cheviot Financial.

Diversification Opportunities for FluenceLimited and Cheviot Financial

-0.62
  Correlation Coefficient

Excellent diversification

The 3 months correlation between FluenceLimited and Cheviot is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Fluence Limited and Cheviot Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheviot Financial Corp and FluenceLimited 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 Fluence Limited are associated (or correlated) with Cheviot Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheviot Financial Corp has no effect on the direction of FluenceLimited i.e., FluenceLimited and Cheviot Financial go up and down completely randomly.

Pair Corralation between FluenceLimited and Cheviot Financial

Assuming the 90 days horizon Fluence Limited is expected to generate 10.5 times more return on investment than Cheviot Financial. However, FluenceLimited is 10.5 times more volatile than Cheviot Financial Corp. It trades about 0.13 of its potential returns per unit of risk. Cheviot Financial Corp is currently generating about -0.03 per unit of risk. If you would invest  3.60  in Fluence Limited on August 31, 2025 and sell it today you would earn a total of  3.53  from holding Fluence Limited or generate 98.06% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Fluence Limited  vs.  Cheviot Financial Corp

 Performance 
       Timeline  
Fluence Limited 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Fluence Limited are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating technical and fundamental indicators, FluenceLimited reported solid returns over the last few months and may actually be approaching a breakup point.
Cheviot Financial Corp 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Cheviot Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Cheviot Financial is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

FluenceLimited and Cheviot Financial Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with FluenceLimited and Cheviot Financial

The main advantage of trading using opposite FluenceLimited and Cheviot Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FluenceLimited position performs unexpectedly, Cheviot Financial 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 Cheviot Financial will offset losses from the drop in Cheviot Financial's long position.
The idea behind Fluence Limited and Cheviot Financial Corp 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 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..

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