Correlation Between FOKUS MINING and SERI INDUSTRIAL

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

By analyzing existing cross correlation between FOKUS MINING P and SERI INDUSTRIAL EO, you can compare the effects of market volatilities on FOKUS MINING and SERI INDUSTRIAL 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 FOKUS MINING with a short position of SERI INDUSTRIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of FOKUS MINING and SERI INDUSTRIAL.

Diversification Opportunities for FOKUS MINING and SERI INDUSTRIAL

0.09

Correlation Coefficient

FOKUS MINING  SERI INDUSTRIAL

Significant diversification

The 3 months correlation between FOKUS and SERI is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding FOKUS MINING P and SERI INDUSTRIAL EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SERI INDUSTRIAL EO and FOKUS MINING 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 FOKUS MINING P are associated (or correlated) with SERI INDUSTRIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SERI INDUSTRIAL EO has no effect on the direction of FOKUS MINING i.e., FOKUS MINING and SERI INDUSTRIAL go up and down completely randomly.

Pair Corralation between FOKUS MINING and SERI INDUSTRIAL

Assuming the 90 days trading horizon FOKUS MINING P is expected to under-perform the SERI INDUSTRIAL. In addition to that, FOKUS MINING is 1.15 times more volatile than SERI INDUSTRIAL EO. It trades about -0.02 of its total potential returns per unit of risk. SERI INDUSTRIAL EO is currently generating about 0.05 per unit of volatility. If you would invest  190.00  in SERI INDUSTRIAL EO on April 23, 2025 and sell it today you would earn a total of  17.00  from holding SERI INDUSTRIAL EO or generate 8.95% return on investment over 90 days.

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

FOKUS MINING P  vs.  SERI INDUSTRIAL EO

FOKUS MINING P

Risk-Adjusted Performance

Very Weak

Over the last 90 days FOKUS MINING P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, FOKUS MINING is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SERI INDUSTRIAL EO

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SERI INDUSTRIAL EO are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, SERI INDUSTRIAL reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FOKUS MINING and SERI INDUSTRIAL

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

The idea behind FOKUS MINING P and SERI INDUSTRIAL EO 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.