Correlation Between Fujian Rongji and Chahua Modern
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By analyzing existing cross correlation between Fujian Rongji Software and Chahua Modern Housewares, you can compare the effects of market volatilities on Fujian Rongji and Chahua Modern 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 Rongji with a short position of Chahua Modern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Rongji and Chahua Modern.
Diversification Opportunities for Fujian Rongji and Chahua Modern
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fujian and Chahua is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Rongji Software and Chahua Modern Housewares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chahua Modern Housewares and Fujian Rongji 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 Rongji Software are associated (or correlated) with Chahua Modern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chahua Modern Housewares has no effect on the direction of Fujian Rongji i.e., Fujian Rongji and Chahua Modern go up and down completely randomly.
Pair Corralation between Fujian Rongji and Chahua Modern
Assuming the 90 days trading horizon Fujian Rongji is expected to generate 1.82 times less return on investment than Chahua Modern. In addition to that, Fujian Rongji is 1.03 times more volatile than Chahua Modern Housewares. It trades about 0.09 of its total potential returns per unit of risk. Chahua Modern Housewares is currently generating about 0.17 per unit of volatility. If you would invest 1,133 in Chahua Modern Housewares on November 3, 2024 and sell it today you would earn a total of 1,153 from holding Chahua Modern Housewares or generate 101.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Rongji Software vs. Chahua Modern Housewares
Performance |
| Timeline |
| Fujian Rongji Software |
| Chahua Modern Housewares |
Fujian Rongji and Chahua Modern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Rongji and Chahua Modern
The main advantage of trading using opposite Fujian Rongji and Chahua Modern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Rongji position performs unexpectedly, Chahua Modern 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 Chahua Modern will offset losses from the drop in Chahua Modern's long position.| Fujian Rongji vs. Beijing Bewinner Communications | Fujian Rongji vs. Shenzhen Cotran New | Fujian Rongji vs. Super Dragon Engineering Plastics | Fujian Rongji vs. Cansino Biologics |
| Chahua Modern vs. China Asset Management | Chahua Modern vs. Jahen Household Products | Chahua Modern vs. Huatian Hotel Group | Chahua Modern vs. Hengdian Entertainment 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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