Correlation Between Fabrinet and Mohawk Group
Can any of the company-specific risk be diversified away by investing in both Fabrinet and Mohawk Group 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 Mohawk Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fabrinet and Mohawk Group Holdings, you can compare the effects of market volatilities on Fabrinet and Mohawk Group 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 Mohawk Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fabrinet and Mohawk Group.
Diversification Opportunities for Fabrinet and Mohawk Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fabrinet and Mohawk is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fabrinet and Mohawk Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mohawk Group Holdings 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 Mohawk Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mohawk Group Holdings has no effect on the direction of Fabrinet i.e., Fabrinet and Mohawk Group go up and down completely randomly.
Pair Corralation between Fabrinet and Mohawk Group
If you would invest 9,725 in Fabrinet on January 17, 2024 and sell it today you would earn a total of 7,563 from holding Fabrinet or generate 77.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Fabrinet vs. Mohawk Group Holdings
Performance |
| Timeline |
| Fabrinet |
| Mohawk Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Fabrinet and Mohawk Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fabrinet and Mohawk Group
The main advantage of trading using opposite Fabrinet and Mohawk Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fabrinet position performs unexpectedly, Mohawk Group 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 Mohawk Group will offset losses from the drop in Mohawk Group's long position.The idea behind Fabrinet and Mohawk Group Holdings 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.| Mohawk Group vs. Procter Gamble | Mohawk Group vs. Alto Ingredients | Mohawk Group vs. Saia Inc | Mohawk Group vs. NL Industries |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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