Correlation Between Standard Foods and Fwusow Industry
Can any of the company-specific risk be diversified away by investing in both Standard Foods and Fwusow Industry at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Standard Foods and Fwusow Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standard Foods Corp and Fwusow Industry Co, you can compare the effects of market volatilities on Standard Foods and Fwusow Industry 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 Standard Foods with a short position of Fwusow Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standard Foods and Fwusow Industry.
Diversification Opportunities for Standard Foods and Fwusow Industry
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Standard and Fwusow is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Standard Foods Corp and Fwusow Industry Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fwusow Industry and Standard Foods 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 Standard Foods Corp are associated (or correlated) with Fwusow Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fwusow Industry has no effect on the direction of Standard Foods i.e., Standard Foods and Fwusow Industry go up and down completely randomly.
Pair Corralation between Standard Foods and Fwusow Industry
Assuming the 90 days trading horizon Standard Foods Corp is expected to generate 0.87 times more return on investment than Fwusow Industry. However, Standard Foods Corp is 1.15 times less risky than Fwusow Industry. It trades about 0.11 of its potential returns per unit of risk. Fwusow Industry Co is currently generating about -0.28 per unit of risk. If you would invest 3,745 in Standard Foods Corp on September 13, 2024 and sell it today you would earn a total of 40.00 from holding Standard Foods Corp or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Standard Foods Corp vs. Fwusow Industry Co
Performance |
| Timeline |
| Standard Foods Corp |
| Fwusow Industry |
Standard Foods and Fwusow Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standard Foods and Fwusow Industry
The main advantage of trading using opposite Standard Foods and Fwusow Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standard Foods position performs unexpectedly, Fwusow Industry 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 Fwusow Industry will offset losses from the drop in Fwusow Industry's long position.| Standard Foods vs. Uni President Enterprises Corp | Standard Foods vs. Great Wall Enterprise | Standard Foods vs. Ruentex Development Co | Standard Foods vs. WiseChip Semiconductor |
| Fwusow Industry vs. Great Wall Enterprise | Fwusow Industry vs. Charoen Pokphand Enterprise | Fwusow Industry vs. Taisun Enterprise Co | Fwusow Industry vs. Lian Hwa Foods |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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