Correlation Between FORWARD AIR and Fresnillo Plc

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

By analyzing existing cross correlation between FORWARD AIR P and Fresnillo plc, you can compare the effects of market volatilities on FORWARD AIR and Fresnillo Plc 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 FORWARD AIR with a short position of Fresnillo Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORWARD AIR and Fresnillo Plc.

Diversification Opportunities for FORWARD AIR and Fresnillo Plc

0.82

Correlation Coefficient

FORWARD AIR  Fresnillo Plc

Very poor diversification

The 3 months correlation between FORWARD and Fresnillo is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding FORWARD AIR P and Fresnillo plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresnillo plc and FORWARD AIR 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 FORWARD AIR P are associated (or correlated) with Fresnillo Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresnillo plc has no effect on the direction of FORWARD AIR i.e., FORWARD AIR and Fresnillo Plc go up and down completely randomly.

Pair Corralation between FORWARD AIR and Fresnillo Plc

Assuming the 90 days horizon FORWARD AIR P is expected to generate 1.64 times more return on investment than Fresnillo Plc. However, FORWARD AIR is 1.64 times more volatile than Fresnillo plc. It trades about 0.21 of its potential returns per unit of risk. Fresnillo plc is currently generating about 0.25 per unit of risk. If you would invest  1,330  in FORWARD AIR P on April 23, 2025 and sell it today you would earn a total of  935.00  from holding FORWARD AIR P or generate 70.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.44%
Values	Daily Returns

FORWARD AIR P  vs.  Fresnillo plc

FORWARD AIR P

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FORWARD AIR P are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, FORWARD AIR reported solid returns over the last few months and may actually be approaching a breakup point.

Fresnillo plc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fresnillo plc are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Fresnillo Plc reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FORWARD AIR and Fresnillo Plc

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

The idea behind FORWARD AIR P and Fresnillo plc 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.