Correlation Between FingerMotion and System1

Can any of the company-specific risk be diversified away by investing in both FingerMotion and System1 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 FingerMotion and System1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FingerMotion and System1, you can compare the effects of market volatilities on FingerMotion and System1 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 FingerMotion with a short position of System1. Check out your portfolio center. Please also check ongoing floating volatility patterns of FingerMotion and System1.

Diversification Opportunities for FingerMotion and System1

-0.55

Correlation Coefficient

FingerMotion  System1

Excellent diversification

The 3 months correlation between FingerMotion and System1 is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding FingerMotion and System1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on System1 and FingerMotion 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 FingerMotion are associated (or correlated) with System1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of System1 has no effect on the direction of FingerMotion i.e., FingerMotion and System1 go up and down completely randomly.

Pair Corralation between FingerMotion and System1

Given the investment horizon of 90 days FingerMotion is expected to under-perform the System1. But the stock apears to be less risky and, when comparing its historical volatility, FingerMotion is 1.82 times less risky than System1. The stock trades about -0.22 of its potential returns per unit of risk. The System1 is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  405.00  in System1 on May 22, 2025 and sell it today you would earn a total of  255.00  from holding System1 or generate 62.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

FingerMotion  vs.  System1

FingerMotion

Risk-Adjusted Performance

Weakest

Over the last 90 days FingerMotion has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in September 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

System1

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in System1 are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, System1 unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FingerMotion and System1

The main advantage of trading using opposite FingerMotion and System1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FingerMotion position performs unexpectedly, System1 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 System1 will offset losses from the drop in System1's long position.

The idea behind FingerMotion and System1 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.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.