Correlation Between Fujian Longzhou and Beijing Baolande
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By analyzing existing cross correlation between Fujian Longzhou Transportation and Beijing Baolande Software, you can compare the effects of market volatilities on Fujian Longzhou and Beijing Baolande 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 Beijing Baolande. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Longzhou and Beijing Baolande.
Diversification Opportunities for Fujian Longzhou and Beijing Baolande
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fujian and Beijing is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Longzhou Transportation and Beijing Baolande Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Baolande Software 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 Beijing Baolande. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Baolande Software has no effect on the direction of Fujian Longzhou i.e., Fujian Longzhou and Beijing Baolande go up and down completely randomly.
Pair Corralation between Fujian Longzhou and Beijing Baolande
Assuming the 90 days trading horizon Fujian Longzhou Transportation is expected to generate 0.96 times more return on investment than Beijing Baolande. However, Fujian Longzhou Transportation is 1.04 times less risky than Beijing Baolande. It trades about 0.02 of its potential returns per unit of risk. Beijing Baolande Software is currently generating about -0.02 per unit of risk. If you would invest 436.00 in Fujian Longzhou Transportation on October 29, 2024 and sell it today you would lose (28.00) from holding Fujian Longzhou Transportation or give up 6.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Longzhou Transportation vs. Beijing Baolande Software
Performance |
| Timeline |
| Fujian Longzhou Tran |
| Beijing Baolande Software |
Fujian Longzhou and Beijing Baolande Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Longzhou and Beijing Baolande
The main advantage of trading using opposite Fujian Longzhou and Beijing Baolande positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Longzhou position performs unexpectedly, Beijing Baolande 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 Beijing Baolande will offset losses from the drop in Beijing Baolande's long position.| Fujian Longzhou vs. Weihai Honglin Electronic | Fujian Longzhou vs. Liaoning Dingjide Petrochemical | Fujian Longzhou vs. YiDong Electronics Technology | Fujian Longzhou vs. Guangdong Ellington Electronics |
| Beijing Baolande vs. Fujian Oriental Silver | Beijing Baolande vs. Huaibei Mining Holdings | Beijing Baolande vs. JCHX Mining Management | Beijing Baolande vs. Jiaozuo Wanfang Aluminum |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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