Correlation Between Fortinet and MicroAlgo

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

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

Diversification Opportunities for Fortinet and MicroAlgo

-0.58

Correlation Coefficient

Fortinet  MicroAlgo

Excellent diversification

The 3 months correlation between Fortinet and MicroAlgo is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Fortinet and MicroAlgo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MicroAlgo 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 MicroAlgo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MicroAlgo has no effect on the direction of Fortinet i.e., Fortinet and MicroAlgo go up and down completely randomly.

Pair Corralation between Fortinet and MicroAlgo

Given the investment horizon of 90 days Fortinet is expected to generate 0.17 times more return on investment than MicroAlgo. However, Fortinet is 5.79 times less risky than MicroAlgo. It trades about 0.1 of its potential returns per unit of risk. MicroAlgo is currently generating about -0.33 per unit of risk. If you would invest  9,272  in Fortinet on April 21, 2025 and sell it today you would earn a total of  1,270  from holding Fortinet or generate 13.7% return on investment over 90 days.

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

Fortinet  vs.  MicroAlgo

Fortinet

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fortinet are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Fortinet unveiled solid returns over the last few months and may actually be approaching a breakup point.

MicroAlgo

Risk-Adjusted Performance

Very Weak

Over the last 90 days MicroAlgo has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in August 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Fortinet and MicroAlgo

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

The idea behind Fortinet and MicroAlgo 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.