Correlation Between Fujian Longzhou and Hubei Xingfa
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By analyzing existing cross correlation between Fujian Longzhou Transportation and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Fujian Longzhou and Hubei Xingfa 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 Longzhou with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Longzhou and Hubei Xingfa.
Diversification Opportunities for Fujian Longzhou and Hubei Xingfa
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Hubei is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Longzhou Transportation and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals and Fujian Longzhou 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 Longzhou Transportation are associated (or correlated) with Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Fujian Longzhou i.e., Fujian Longzhou and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Fujian Longzhou and Hubei Xingfa
Assuming the 90 days trading horizon Fujian Longzhou Transportation is expected to generate 1.67 times more return on investment than Hubei Xingfa. However, Fujian Longzhou is 1.67 times more volatile than Hubei Xingfa Chemicals. It trades about 0.02 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.02 per unit of risk. If you would invest 468.00 in Fujian Longzhou Transportation on August 26, 2024 and sell it today you would lose (13.00) from holding Fujian Longzhou Transportation or give up 2.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Longzhou Transportation vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Fujian Longzhou Tran |
| Hubei Xingfa Chemicals |
Fujian Longzhou and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Longzhou and Hubei Xingfa
The main advantage of trading using opposite Fujian Longzhou and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Longzhou position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Fujian Longzhou vs. Agricultural Bank of | Fujian Longzhou vs. Industrial and Commercial | Fujian Longzhou vs. Bank of China | Fujian Longzhou vs. China Construction Bank |
| Hubei Xingfa vs. Huaibei Mining Holdings | Hubei Xingfa vs. Guocheng Mining Co | Hubei Xingfa vs. Shandong Mining Machinery | Hubei Xingfa vs. Peoples Insurance of |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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