Correlation Between Orbit Garant and Foraco International

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

By analyzing existing cross correlation between Orbit Garant Drilling and Foraco International SA, you can compare the effects of market volatilities on Orbit Garant and Foraco 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 Orbit Garant with a short position of Foraco International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orbit Garant and Foraco International.

Diversification Opportunities for Orbit Garant and Foraco International

0.6

Correlation Coefficient

Orbit Garant  Foraco International

Poor diversification

The 3 months correlation between Orbit and Foraco is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Orbit Garant Drilling and Foraco International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foraco International and Orbit Garant 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 Orbit Garant Drilling are associated (or correlated) with Foraco International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foraco International has no effect on the direction of Orbit Garant i.e., Orbit Garant and Foraco International go up and down completely randomly.

Pair Corralation between Orbit Garant and Foraco International

Assuming the 90 days trading horizon Orbit Garant is expected to generate 10.51 times less return on investment than Foraco International. In addition to that, Orbit Garant is 1.27 times more volatile than Foraco International SA. It trades about 0.01 of its total potential returns per unit of risk. Foraco International SA is currently generating about 0.16 per unit of volatility. If you would invest  185.00  in Foraco International SA on July 2, 2025 and sell it today you would earn a total of  36.00  from holding Foraco International SA or generate 19.46% return on investment over 90 days.

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

Orbit Garant Drilling  vs.  Foraco International SA

Orbit Garant Drilling

Risk-Adjusted Performance

Weakest

Over the last 90 days Orbit Garant Drilling has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Orbit Garant is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Foraco International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Foraco International SA are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Foraco International displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Orbit Garant and Foraco International

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

The idea behind Orbit Garant Drilling and Foraco International SA 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.