Correlation Between Fujian Longzhou and Sanxiang Advanced
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By analyzing existing cross correlation between Fujian Longzhou Transportation and Sanxiang Advanced Materials, you can compare the effects of market volatilities on Fujian Longzhou and Sanxiang Advanced 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 Sanxiang Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Longzhou and Sanxiang Advanced.
Diversification Opportunities for Fujian Longzhou and Sanxiang Advanced
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fujian and Sanxiang is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Longzhou Transportation and Sanxiang Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanxiang Advanced 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 Sanxiang Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanxiang Advanced has no effect on the direction of Fujian Longzhou i.e., Fujian Longzhou and Sanxiang Advanced go up and down completely randomly.
Pair Corralation between Fujian Longzhou and Sanxiang Advanced
Assuming the 90 days trading horizon Fujian Longzhou is expected to generate 4.96 times less return on investment than Sanxiang Advanced. In addition to that, Fujian Longzhou is 1.06 times more volatile than Sanxiang Advanced Materials. It trades about 0.01 of its total potential returns per unit of risk. Sanxiang Advanced Materials is currently generating about 0.04 per unit of volatility. If you would invest 1,175 in Sanxiang Advanced Materials on October 26, 2024 and sell it today you would earn a total of 563.00 from holding Sanxiang Advanced Materials or generate 47.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Longzhou Transportation vs. Sanxiang Advanced Materials
Performance |
| Timeline |
| Fujian Longzhou Tran |
| Sanxiang Advanced |
Fujian Longzhou and Sanxiang Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Longzhou and Sanxiang Advanced
The main advantage of trading using opposite Fujian Longzhou and Sanxiang Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Longzhou position performs unexpectedly, Sanxiang Advanced 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 Sanxiang Advanced will offset losses from the drop in Sanxiang Advanced's long position.| Fujian Longzhou vs. Industrial and Commercial | Fujian Longzhou vs. Agricultural Bank of | Fujian Longzhou vs. China Construction Bank | Fujian Longzhou vs. Bank of China |
| Sanxiang Advanced vs. Lootom Telcovideo Network | Sanxiang Advanced vs. Fujian Longzhou Transportation | Sanxiang Advanced vs. Jiangsu Jinling Sports | Sanxiang Advanced vs. Nanjing Putian Telecommunications |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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