Correlation Between Fujian Newland and Goodwill E
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By analyzing existing cross correlation between Fujian Newland Computer and Goodwill E Health, you can compare the effects of market volatilities on Fujian Newland and Goodwill E 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 Goodwill E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Newland and Goodwill E.
Diversification Opportunities for Fujian Newland and Goodwill E
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fujian and Goodwill is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Newland Computer and Goodwill E Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodwill E Health 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 Goodwill E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodwill E Health has no effect on the direction of Fujian Newland i.e., Fujian Newland and Goodwill E go up and down completely randomly.
Pair Corralation between Fujian Newland and Goodwill E
Assuming the 90 days trading horizon Fujian Newland Computer is expected to generate 0.72 times more return on investment than Goodwill E. However, Fujian Newland Computer is 1.38 times less risky than Goodwill E. It trades about 0.03 of its potential returns per unit of risk. Goodwill E Health is currently generating about -0.01 per unit of risk. If you would invest 1,512 in Fujian Newland Computer on November 7, 2024 and sell it today you would earn a total of 478.00 from holding Fujian Newland Computer or generate 31.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Newland Computer vs. Goodwill E Health
Performance |
| Timeline |
| Fujian Newland Computer |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Goodwill E Health |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Fujian Newland and Goodwill E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Newland and Goodwill E
The main advantage of trading using opposite Fujian Newland and Goodwill E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Newland position performs unexpectedly, Goodwill E 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 Goodwill E will offset losses from the drop in Goodwill E's long position.The idea behind Fujian Newland Computer and Goodwill E Health 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.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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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