Correlation Between Fortinet and Box

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

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

Diversification Opportunities for Fortinet and Box

0.81

Correlation Coefficient

Fortinet  Box

Very poor diversification

The 3 months correlation between Fortinet and Box is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Fortinet and Box Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Box Inc and Fortinet 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 Fortinet are associated (or correlated) with Box. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Box Inc has no effect on the direction of Fortinet i.e., Fortinet and Box go up and down completely randomly.

Pair Corralation between Fortinet and Box

Given the investment horizon of 90 days Fortinet is expected to generate 2.48 times less return on investment than Box. In addition to that, Fortinet is 2.72 times more volatile than Box Inc. It trades about 0.03 of its total potential returns per unit of risk. Box Inc is currently generating about 0.23 per unit of volatility. If you would invest  3,002  in Box Inc on February 9, 2025 and sell it today you would earn a total of  140.00  from holding Box Inc or generate 4.66% return on investment over 90 days.

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

Fortinet  vs.  Box Inc

Fortinet

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fortinet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Box Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Box Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Fortinet and Box

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

The idea behind Fortinet and Box Inc 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 Transaction History module to view history of all your transactions and understand their impact on performance.