Correlation Between FST Corp and Fossil

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

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

Diversification Opportunities for FST Corp and Fossil

-0.44

Correlation Coefficient

FST Corp  Fossil

Very good diversification

The 3 months correlation between FST and Fossil is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding FST Corp Ordinary and Fossil Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fossil Group and FST Corp 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 FST Corp Ordinary are associated (or correlated) with Fossil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fossil Group has no effect on the direction of FST Corp i.e., FST Corp and Fossil go up and down completely randomly.

Pair Corralation between FST Corp and Fossil

Given the investment horizon of 90 days FST Corp is expected to generate 43.58 times less return on investment than Fossil. In addition to that, FST Corp is 1.6 times more volatile than Fossil Group. It trades about 0.0 of its total potential returns per unit of risk. Fossil Group is currently generating about 0.17 per unit of volatility. If you would invest  109.00  in Fossil Group on May 2, 2025 and sell it today you would earn a total of  60.00  from holding Fossil Group or generate 55.05% return on investment over 90 days.

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

FST Corp Ordinary  vs.  Fossil Group

FST Corp Ordinary

Risk-Adjusted Performance

Very Weak

Over the last 90 days FST Corp Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, FST Corp is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Fossil Group

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fossil Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal basic indicators, Fossil disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FST Corp and Fossil

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

The idea behind FST Corp Ordinary and Fossil Group 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.