Correlation Between Yantai Changyu and Fiberhome Telecommunicatio
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By analyzing existing cross correlation between Yantai Changyu Pioneer and Fiberhome Telecommunication Technologies, you can compare the effects of market volatilities on Yantai Changyu and Fiberhome Telecommunicatio 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 Yantai Changyu with a short position of Fiberhome Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yantai Changyu and Fiberhome Telecommunicatio.
Diversification Opportunities for Yantai Changyu and Fiberhome Telecommunicatio
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yantai and Fiberhome is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Yantai Changyu Pioneer and Fiberhome Telecommunication Te in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiberhome Telecommunicatio and Yantai Changyu 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 Yantai Changyu Pioneer are associated (or correlated) with Fiberhome Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiberhome Telecommunicatio has no effect on the direction of Yantai Changyu i.e., Yantai Changyu and Fiberhome Telecommunicatio go up and down completely randomly.
Pair Corralation between Yantai Changyu and Fiberhome Telecommunicatio
Assuming the 90 days trading horizon Yantai Changyu Pioneer is expected to under-perform the Fiberhome Telecommunicatio. But the stock apears to be less risky and, when comparing its historical volatility, Yantai Changyu Pioneer is 1.64 times less risky than Fiberhome Telecommunicatio. The stock trades about -0.02 of its potential returns per unit of risk. The Fiberhome Telecommunication Technologies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,369 in Fiberhome Telecommunication Technologies on September 5, 2024 and sell it today you would earn a total of 490.00 from holding Fiberhome Telecommunication Technologies or generate 35.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yantai Changyu Pioneer vs. Fiberhome Telecommunication Te
Performance |
| Timeline |
| Yantai Changyu Pioneer |
| Fiberhome Telecommunicatio |
Yantai Changyu and Fiberhome Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yantai Changyu and Fiberhome Telecommunicatio
The main advantage of trading using opposite Yantai Changyu and Fiberhome Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yantai Changyu position performs unexpectedly, Fiberhome Telecommunicatio 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 Fiberhome Telecommunicatio will offset losses from the drop in Fiberhome Telecommunicatio's long position.| Yantai Changyu vs. Fiberhome Telecommunication Technologies | Yantai Changyu vs. Nancal Energy Saving Tech | Yantai Changyu vs. Zhongtong Guomai Communication | Yantai Changyu vs. Tongyu Communication |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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