Correlation Between Flow Traders and ForFarmers

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

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

Diversification Opportunities for Flow Traders and ForFarmers

0.0

Correlation Coefficient

Flow Traders  ForFarmers

Pay attention - limited upside

The 3 months correlation between Flow and ForFarmers is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Flow Traders BV and ForFarmers NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ForFarmers NV and Flow Traders 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 Flow Traders BV are associated (or correlated) with ForFarmers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ForFarmers NV has no effect on the direction of Flow Traders i.e., Flow Traders and ForFarmers go up and down completely randomly.

Pair Corralation between Flow Traders and ForFarmers

If you would invest  2,450  in Flow Traders BV on February 3, 2025 and sell it today you would earn a total of  212.00  from holding Flow Traders BV or generate 8.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Flow Traders BV  vs.  ForFarmers NV

Flow Traders BV

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Flow Traders BV are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Flow Traders may actually be approaching a critical reversion point that can send shares even higher in June 2025.

ForFarmers NV

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ForFarmers NV are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ForFarmers sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Flow Traders and ForFarmers

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

The idea behind Flow Traders BV and ForFarmers NV 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.