Correlation Between Fabrinet and Corning Incorporated
Can any of the company-specific risk be diversified away by investing in both Fabrinet and Corning Incorporated 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 Fabrinet and Corning Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fabrinet and Corning Incorporated, you can compare the effects of market volatilities on Fabrinet and Corning Incorporated 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 Fabrinet with a short position of Corning Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fabrinet and Corning Incorporated.
Diversification Opportunities for Fabrinet and Corning Incorporated
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fabrinet and Corning is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Fabrinet and Corning Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corning Incorporated and Fabrinet 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 Fabrinet are associated (or correlated) with Corning Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corning Incorporated has no effect on the direction of Fabrinet i.e., Fabrinet and Corning Incorporated go up and down completely randomly.
Pair Corralation between Fabrinet and Corning Incorporated
Allowing for the 90-day total investment horizon Fabrinet is expected to generate 1.77 times more return on investment than Corning Incorporated. However, Fabrinet is 1.77 times more volatile than Corning Incorporated. It trades about 0.23 of its potential returns per unit of risk. Corning Incorporated is currently generating about 0.28 per unit of risk. If you would invest 23,283 in Fabrinet on June 7, 2025 and sell it today you would earn a total of 12,933 from holding Fabrinet or generate 55.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fabrinet vs. Corning Incorporated
Performance |
| Timeline |
| Fabrinet |
| Corning Incorporated |
Fabrinet and Corning Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fabrinet and Corning Incorporated
The main advantage of trading using opposite Fabrinet and Corning Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fabrinet position performs unexpectedly, Corning Incorporated 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 Corning Incorporated will offset losses from the drop in Corning Incorporated's long position.The idea behind Fabrinet and Corning Incorporated 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.| Corning Incorporated vs. Mobilicom Limited American | Corning Incorporated vs. Sonim Technologies | Corning Incorporated vs. PowerFleet, | Corning Incorporated vs. Moving iMage Technologies |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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