Correlation Between Xiangyang Automobile and Fibocom Wireless
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Fibocom Wireless, you can compare the effects of market volatilities on Xiangyang Automobile and Fibocom Wireless 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 Xiangyang Automobile with a short position of Fibocom Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Fibocom Wireless.
Diversification Opportunities for Xiangyang Automobile and Fibocom Wireless
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiangyang and Fibocom is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Fibocom Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fibocom Wireless and Xiangyang Automobile 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 Xiangyang Automobile Bearing are associated (or correlated) with Fibocom Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fibocom Wireless has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Fibocom Wireless go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Fibocom Wireless
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to under-perform the Fibocom Wireless. In addition to that, Xiangyang Automobile is 1.1 times more volatile than Fibocom Wireless. It trades about -0.16 of its total potential returns per unit of risk. Fibocom Wireless is currently generating about 0.03 per unit of volatility. If you would invest 1,834 in Fibocom Wireless on October 16, 2024 and sell it today you would earn a total of 23.00 from holding Fibocom Wireless or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Fibocom Wireless
Performance |
| Timeline |
| Xiangyang Automobile |
| Fibocom Wireless |
Xiangyang Automobile and Fibocom Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Fibocom Wireless
The main advantage of trading using opposite Xiangyang Automobile and Fibocom Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Fibocom Wireless 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 Fibocom Wireless will offset losses from the drop in Fibocom Wireless' long position.The idea behind Xiangyang Automobile Bearing and Fibocom Wireless 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.
| Fibocom Wireless vs. Xiangyang Automobile Bearing | Fibocom Wireless vs. Yingde Greatchem Chemicals | Fibocom Wireless vs. Do Fluoride Chemicals Co | Fibocom Wireless vs. Yindu Kitchen Equipment |
Check out your portfolio center.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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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