Correlation Between Nan Ya and Fwusow Industry
Can any of the company-specific risk be diversified away by investing in both Nan Ya 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 Nan Ya and Fwusow Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nan Ya Plastics and Fwusow Industry Co, you can compare the effects of market volatilities on Nan Ya 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 Nan Ya with a short position of Fwusow Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nan Ya and Fwusow Industry.
Diversification Opportunities for Nan Ya and Fwusow Industry
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nan and Fwusow is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Nan Ya Plastics and Fwusow Industry Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fwusow Industry and Nan Ya 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 Nan Ya Plastics 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 Nan Ya i.e., Nan Ya and Fwusow Industry go up and down completely randomly.
Pair Corralation between Nan Ya and Fwusow Industry
Assuming the 90 days trading horizon Nan Ya Plastics is expected to under-perform the Fwusow Industry. In addition to that, Nan Ya is 3.25 times more volatile than Fwusow Industry Co. It trades about -0.41 of its total potential returns per unit of risk. Fwusow Industry Co is currently generating about -0.29 per unit of volatility. If you would invest 1,715 in Fwusow Industry Co on September 12, 2024 and sell it today you would lose (60.00) from holding Fwusow Industry Co or give up 3.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nan Ya Plastics vs. Fwusow Industry Co
Performance |
| Timeline |
| Nan Ya Plastics |
| Fwusow Industry |
Nan Ya and Fwusow Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nan Ya and Fwusow Industry
The main advantage of trading using opposite Nan Ya and Fwusow Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nan Ya 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.| Nan Ya vs. Tainan Spinning Co | Nan Ya vs. Lealea Enterprise Co | Nan Ya vs. China Petrochemical Development | Nan Ya vs. Ruentex Development Co |
| Fwusow Industry vs. Standard Foods Corp | Fwusow Industry vs. Uni President Enterprises Corp | Fwusow Industry vs. Great Wall Enterprise | Fwusow Industry vs. Ruentex Development Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |