Correlation Between Falcon Energy and Partners Value

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

By analyzing existing cross correlation between Falcon Energy Materials and Partners Value Investments, you can compare the effects of market volatilities on Falcon Energy and Partners Value 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 Falcon Energy with a short position of Partners Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Falcon Energy and Partners Value.

Diversification Opportunities for Falcon Energy and Partners Value

-0.32

Correlation Coefficient

Falcon Energy  Partners Value

Very good diversification

The 3 months correlation between Falcon and Partners is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Falcon Energy Materials and Partners Value Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Value Inves and Falcon Energy 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 Falcon Energy Materials are associated (or correlated) with Partners Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Value Inves has no effect on the direction of Falcon Energy i.e., Falcon Energy and Partners Value go up and down completely randomly.

Pair Corralation between Falcon Energy and Partners Value

Assuming the 90 days trading horizon Falcon Energy Materials is expected to under-perform the Partners Value. In addition to that, Falcon Energy is 1.83 times more volatile than Partners Value Investments. It trades about -0.02 of its total potential returns per unit of risk. Partners Value Investments is currently generating about 0.1 per unit of volatility. If you would invest  13,000  in Partners Value Investments on April 24, 2025 and sell it today you would earn a total of  1,925  from holding Partners Value Investments or generate 14.81% return on investment over 90 days.

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

Falcon Energy Materials  vs.  Partners Value Investments

Falcon Energy Materials

Risk-Adjusted Performance

Very Weak

Over the last 90 days Falcon Energy Materials has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Falcon Energy is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Partners Value Inves

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Partners Value Investments are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Partners Value sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Falcon Energy and Partners Value

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

The idea behind Falcon Energy Materials and Partners Value Investments 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.