Correlation Between Focus Media and Ligao Foods
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By analyzing existing cross correlation between Focus Media Information and Ligao Foods CoLtd, you can compare the effects of market volatilities on Focus Media and Ligao Foods 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 Focus Media with a short position of Ligao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Media and Ligao Foods.
Diversification Opportunities for Focus Media and Ligao Foods
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Focus and Ligao is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Focus Media Information and Ligao Foods CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ligao Foods CoLtd and Focus Media 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 Focus Media Information are associated (or correlated) with Ligao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ligao Foods CoLtd has no effect on the direction of Focus Media i.e., Focus Media and Ligao Foods go up and down completely randomly.
Pair Corralation between Focus Media and Ligao Foods
Assuming the 90 days trading horizon Focus Media Information is expected to generate 0.5 times more return on investment than Ligao Foods. However, Focus Media Information is 1.99 times less risky than Ligao Foods. It trades about -0.18 of its potential returns per unit of risk. Ligao Foods CoLtd is currently generating about -0.09 per unit of risk. If you would invest 745.00 in Focus Media Information on August 25, 2024 and sell it today you would lose (45.00) from holding Focus Media Information or give up 6.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Focus Media Information vs. Ligao Foods CoLtd
Performance |
| Timeline |
| Focus Media Information |
| Ligao Foods CoLtd |
Focus Media and Ligao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Media and Ligao Foods
The main advantage of trading using opposite Focus Media and Ligao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Media position performs unexpectedly, Ligao Foods 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 Ligao Foods will offset losses from the drop in Ligao Foods' long position.| Focus Media vs. Agricultural Bank of | Focus Media vs. Industrial and Commercial | Focus Media vs. Bank of China | Focus Media vs. China Construction Bank |
| Ligao Foods vs. China Railway Construction | Ligao Foods vs. Focus Media Information | Ligao Foods vs. Long Yuan Construction | Ligao Foods vs. Ningbo Construction 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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