Correlation Between FSPG Hi and Yangmei Chemical
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By analyzing existing cross correlation between FSPG Hi Tech Co and Yangmei Chemical Co, you can compare the effects of market volatilities on FSPG Hi and Yangmei Chemical 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 FSPG Hi with a short position of Yangmei Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of FSPG Hi and Yangmei Chemical.
Diversification Opportunities for FSPG Hi and Yangmei Chemical
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FSPG and Yangmei is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding FSPG Hi Tech Co and Yangmei Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yangmei Chemical and FSPG Hi 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 FSPG Hi Tech Co are associated (or correlated) with Yangmei Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yangmei Chemical has no effect on the direction of FSPG Hi i.e., FSPG Hi and Yangmei Chemical go up and down completely randomly.
Pair Corralation between FSPG Hi and Yangmei Chemical
Assuming the 90 days trading horizon FSPG Hi Tech Co is expected to generate 1.08 times more return on investment than Yangmei Chemical. However, FSPG Hi is 1.08 times more volatile than Yangmei Chemical Co. It trades about 0.18 of its potential returns per unit of risk. Yangmei Chemical Co is currently generating about 0.07 per unit of risk. If you would invest 372.00 in FSPG Hi Tech Co on September 5, 2024 and sell it today you would earn a total of 370.00 from holding FSPG Hi Tech Co or generate 99.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.17% |
| Values | Daily Returns |
FSPG Hi Tech Co vs. Yangmei Chemical Co
Performance |
| Timeline |
| FSPG Hi Tech |
| Yangmei Chemical |
FSPG Hi and Yangmei Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FSPG Hi and Yangmei Chemical
The main advantage of trading using opposite FSPG Hi and Yangmei Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FSPG Hi position performs unexpectedly, Yangmei Chemical 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 Yangmei Chemical will offset losses from the drop in Yangmei Chemical's long position.| FSPG Hi vs. Super Dragon Engineering Plastics | FSPG Hi vs. Zhongshan Public Utilities | FSPG Hi vs. Fuda Alloy Materials | FSPG Hi vs. Advanced Technology Materials |
| Yangmei Chemical vs. Sichuan Jinshi Technology | Yangmei Chemical vs. FSPG Hi Tech Co | Yangmei Chemical vs. Wuhan Yangtze Communication | Yangmei Chemical vs. Fujian Newland Computer |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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