Correlation Between Federal Home and Eni SPA
Can any of the company-specific risk be diversified away by investing in both Federal Home and Eni SPA 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 Federal Home and Eni SPA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal Home Loan and Eni SpA ADR, you can compare the effects of market volatilities on Federal Home and Eni SPA 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 Federal Home with a short position of Eni SPA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Home and Eni SPA.
Diversification Opportunities for Federal Home and Eni SPA
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Federal and Eni is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Federal Home Loan and Eni SpA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eni SpA ADR and Federal Home 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 Federal Home Loan are associated (or correlated) with Eni SPA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eni SpA ADR has no effect on the direction of Federal Home i.e., Federal Home and Eni SPA go up and down completely randomly.
Pair Corralation between Federal Home and Eni SPA
Assuming the 90 days horizon Federal Home Loan is expected to under-perform the Eni SPA. In addition to that, Federal Home is 1.66 times more volatile than Eni SpA ADR. It trades about -0.09 of its total potential returns per unit of risk. Eni SpA ADR is currently generating about 0.21 per unit of volatility. If you would invest 3,322 in Eni SpA ADR on September 5, 2025 and sell it today you would earn a total of 485.00 from holding Eni SpA ADR or generate 14.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Federal Home Loan vs. Eni SpA ADR
Performance |
| Timeline |
| Federal Home Loan |
| Eni SpA ADR |
Federal Home and Eni SPA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Home and Eni SPA
The main advantage of trading using opposite Federal Home and Eni SPA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Home position performs unexpectedly, Eni SPA 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 Eni SPA will offset losses from the drop in Eni SPA's long position.| Federal Home vs. Shenzhen Investment Holdings | Federal Home vs. Delaware Investments Florida | Federal Home vs. Erf Wireless | Federal Home vs. Gladstone Investment |
| Eni SPA vs. nDatalyze Corp | Eni SPA vs. JD Sports Fashion | Eni SPA vs. Columbia Sportswear | Eni SPA vs. Dicks Sporting Goods |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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