Correlation Between Future Fintech and British Amer

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

By analyzing existing cross correlation between Future Fintech Group and British American Tobacco, you can compare the effects of market volatilities on Future Fintech and British Amer 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 Future Fintech with a short position of British Amer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Future Fintech and British Amer.

Diversification Opportunities for Future Fintech and British Amer

0.52

Correlation Coefficient

Future Fintech  British Amer

Very weak diversification

The 3 months correlation between Future and British is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Future Fintech Group and British American Tobacco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on British American Tobacco and Future Fintech 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 Future Fintech Group are associated (or correlated) with British Amer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of British American Tobacco has no effect on the direction of Future Fintech i.e., Future Fintech and British Amer go up and down completely randomly.

Pair Corralation between Future Fintech and British Amer

Given the investment horizon of 90 days Future Fintech Group is expected to generate 15.92 times more return on investment than British Amer. However, Future Fintech is 15.92 times more volatile than British American Tobacco. It trades about 0.09 of its potential returns per unit of risk. British American Tobacco is currently generating about 0.26 per unit of risk. If you would invest  146.00  in Future Fintech Group on May 6, 2025 and sell it today you would earn a total of  56.00  from holding Future Fintech Group or generate 38.36% return on investment over 90 days.

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

Future Fintech Group  vs.  British American Tobacco

Future Fintech Group

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Future Fintech Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, Future Fintech unveiled solid returns over the last few months and may actually be approaching a breakup point.

British American Tobacco

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in British American Tobacco are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, British Amer demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Future Fintech and British Amer

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

The idea behind Future Fintech Group and British American Tobacco 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.