Correlation Between Forbo Holding and Feintool International

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

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

Diversification Opportunities for Forbo Holding and Feintool International

0.64

Correlation Coefficient

Forbo Holding  Feintool International

Poor diversification

The 3 months correlation between Forbo and Feintool is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Forbo Holding AG and Feintool International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Feintool International and Forbo Holding 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 Forbo Holding AG are associated (or correlated) with Feintool International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Feintool International has no effect on the direction of Forbo Holding i.e., Forbo Holding and Feintool International go up and down completely randomly.

Pair Corralation between Forbo Holding and Feintool International

Assuming the 90 days trading horizon Forbo Holding AG is expected to under-perform the Feintool International. In addition to that, Forbo Holding is 1.1 times more volatile than Feintool International Holding. It trades about -0.03 of its total potential returns per unit of risk. Feintool International Holding is currently generating about 0.0 per unit of volatility. If you would invest  1,185  in Feintool International Holding on May 19, 2025 and sell it today you would lose (25.00) from holding Feintool International Holding or give up 2.11% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Forbo Holding AG  vs.  Feintool International Holding

Forbo Holding AG

Risk-Adjusted Performance

Weakest

Over the last 90 days Forbo Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Forbo Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Feintool International

Risk-Adjusted Performance

Weakest

Over the last 90 days Feintool International Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Feintool International is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Forbo Holding and Feintool International

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

The idea behind Forbo Holding AG and Feintool International Holding 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .