Correlation Between Fujian Longzhou and Yuanjie Semiconductor
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By analyzing existing cross correlation between Fujian Longzhou Transportation and Yuanjie Semiconductor Technology, you can compare the effects of market volatilities on Fujian Longzhou and Yuanjie Semiconductor 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 Yuanjie Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Longzhou and Yuanjie Semiconductor.
Diversification Opportunities for Fujian Longzhou and Yuanjie Semiconductor
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fujian and Yuanjie is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Longzhou Transportation and Yuanjie Semiconductor Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuanjie Semiconductor 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 Yuanjie Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuanjie Semiconductor has no effect on the direction of Fujian Longzhou i.e., Fujian Longzhou and Yuanjie Semiconductor go up and down completely randomly.
Pair Corralation between Fujian Longzhou and Yuanjie Semiconductor
Assuming the 90 days trading horizon Fujian Longzhou Transportation is expected to under-perform the Yuanjie Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Fujian Longzhou Transportation is 1.36 times less risky than Yuanjie Semiconductor. The stock trades about -0.07 of its potential returns per unit of risk. The Yuanjie Semiconductor Technology is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 14,377 in Yuanjie Semiconductor Technology on October 29, 2024 and sell it today you would earn a total of 1,635 from holding Yuanjie Semiconductor Technology or generate 11.37% 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. Yuanjie Semiconductor Technolo
Performance |
| Timeline |
| Fujian Longzhou Tran |
| Yuanjie Semiconductor |
Fujian Longzhou and Yuanjie Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Longzhou and Yuanjie Semiconductor
The main advantage of trading using opposite Fujian Longzhou and Yuanjie Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Longzhou position performs unexpectedly, Yuanjie Semiconductor 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 Yuanjie Semiconductor will offset losses from the drop in Yuanjie Semiconductor'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 |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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