Correlation Between Fujian Newland and Metro Investment
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By analyzing existing cross correlation between Fujian Newland Computer and Metro Investment Development, you can compare the effects of market volatilities on Fujian Newland and Metro Investment 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 Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Newland and Metro Investment.
Diversification Opportunities for Fujian Newland and Metro Investment
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fujian and Metro is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Newland Computer and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of Fujian Newland i.e., Fujian Newland and Metro Investment go up and down completely randomly.
Pair Corralation between Fujian Newland and Metro Investment
Assuming the 90 days trading horizon Fujian Newland Computer is expected to generate 2.11 times more return on investment than Metro Investment. However, Fujian Newland is 2.11 times more volatile than Metro Investment Development. It trades about 0.2 of its potential returns per unit of risk. Metro Investment Development is currently generating about 0.11 per unit of risk. If you would invest 2,056 in Fujian Newland Computer on November 22, 2024 and sell it today you would earn a total of 244.00 from holding Fujian Newland Computer or generate 11.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Newland Computer vs. Metro Investment Development
Performance |
| Timeline |
| Fujian Newland Computer |
| Metro Investment Dev |
Fujian Newland and Metro Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Newland and Metro Investment
The main advantage of trading using opposite Fujian Newland and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Newland position performs unexpectedly, Metro Investment 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 Metro Investment will offset losses from the drop in Metro Investment's long position.| Fujian Newland vs. Maxvision Technology Corp | Fujian Newland vs. Bangyan Technology Co | Fujian Newland vs. Hubei Xingfa Chemicals | Fujian Newland vs. Linewell Software Co |
| Metro Investment vs. Keeson Technology Corp | Metro Investment vs. Jiangsu Yanghe Brewery | Metro Investment vs. Guangzhou Zhujiang Brewery | Metro Investment vs. Beijing Yanjing Brewery |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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