Correlation Between Fujian Newland and Sunwave Communications
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By analyzing existing cross correlation between Fujian Newland Computer and Sunwave Communications Co, you can compare the effects of market volatilities on Fujian Newland and Sunwave Communications 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 Fujian Newland with a short position of Sunwave Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Newland and Sunwave Communications.
Diversification Opportunities for Fujian Newland and Sunwave Communications
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Sunwave is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Newland Computer and Sunwave Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunwave Communications and Fujian Newland 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 Fujian Newland Computer are associated (or correlated) with Sunwave Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunwave Communications has no effect on the direction of Fujian Newland i.e., Fujian Newland and Sunwave Communications go up and down completely randomly.
Pair Corralation between Fujian Newland and Sunwave Communications
Assuming the 90 days trading horizon Fujian Newland Computer is expected to generate 0.96 times more return on investment than Sunwave Communications. However, Fujian Newland Computer is 1.04 times less risky than Sunwave Communications. It trades about 0.25 of its potential returns per unit of risk. Sunwave Communications Co is currently generating about 0.12 per unit of risk. If you would invest 1,649 in Fujian Newland Computer on August 25, 2024 and sell it today you would earn a total of 356.00 from holding Fujian Newland Computer or generate 21.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Newland Computer vs. Sunwave Communications Co
Performance |
| Timeline |
| Fujian Newland Computer |
| Sunwave Communications |
Fujian Newland and Sunwave Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Newland and Sunwave Communications
The main advantage of trading using opposite Fujian Newland and Sunwave Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Newland position performs unexpectedly, Sunwave Communications 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 Sunwave Communications will offset losses from the drop in Sunwave Communications' long position.| Fujian Newland vs. Songz Automobile Air | Fujian Newland vs. Jiajia Food Group | Fujian Newland vs. Sinomach Automobile Co | Fujian Newland vs. Youyou Foods Co |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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