Correlation Between Fastned BV and Prosus NV

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

By analyzing existing cross correlation between Fastned BV and Prosus NV, you can compare the effects of market volatilities on Fastned BV and Prosus NV 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 Fastned BV with a short position of Prosus NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fastned BV and Prosus NV.

Diversification Opportunities for Fastned BV and Prosus NV

0.77

Correlation Coefficient

Fastned BV  Prosus NV

Poor diversification

The 3 months correlation between Fastned and Prosus is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Fastned BV and Prosus NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosus NV and Fastned BV 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 Fastned BV are associated (or correlated) with Prosus NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosus NV has no effect on the direction of Fastned BV i.e., Fastned BV and Prosus NV go up and down completely randomly.

Pair Corralation between Fastned BV and Prosus NV

Assuming the 90 days trading horizon Fastned BV is expected to generate 1.38 times less return on investment than Prosus NV. In addition to that, Fastned BV is 1.71 times more volatile than Prosus NV. It trades about 0.11 of its total potential returns per unit of risk. Prosus NV is currently generating about 0.25 per unit of volatility. If you would invest  3,826  in Prosus NV on April 21, 2025 and sell it today you would earn a total of  1,155  from holding Prosus NV or generate 30.19% return on investment over 90 days.

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

Fastned BV  vs.  Prosus NV

Fastned BV

Risk-Adjusted Performance

OK

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

Prosus NV

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Prosus NV are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Prosus NV unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fastned BV and Prosus NV

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

The idea behind Fastned BV and Prosus NV 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.