Correlation Between Acelon Chemicals and Fu Burg
Can any of the company-specific risk be diversified away by investing in both Acelon Chemicals and Fu Burg 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 Acelon Chemicals and Fu Burg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acelon Chemicals Fiber and Fu Burg Industrial, you can compare the effects of market volatilities on Acelon Chemicals and Fu Burg 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 Acelon Chemicals with a short position of Fu Burg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acelon Chemicals and Fu Burg.
Diversification Opportunities for Acelon Chemicals and Fu Burg
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Acelon and 8929 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Acelon Chemicals Fiber and Fu Burg Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fu Burg Industrial and Acelon Chemicals 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 Acelon Chemicals Fiber are associated (or correlated) with Fu Burg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fu Burg Industrial has no effect on the direction of Acelon Chemicals i.e., Acelon Chemicals and Fu Burg go up and down completely randomly.
Pair Corralation between Acelon Chemicals and Fu Burg
Assuming the 90 days trading horizon Acelon Chemicals Fiber is expected to generate 0.84 times more return on investment than Fu Burg. However, Acelon Chemicals Fiber is 1.19 times less risky than Fu Burg. It trades about -0.12 of its potential returns per unit of risk. Fu Burg Industrial is currently generating about -0.11 per unit of risk. If you would invest 1,245 in Acelon Chemicals Fiber on October 16, 2024 and sell it today you would lose (55.00) from holding Acelon Chemicals Fiber or give up 4.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acelon Chemicals Fiber vs. Fu Burg Industrial
Performance |
| Timeline |
| Acelon Chemicals Fiber |
| Fu Burg Industrial |
Acelon Chemicals and Fu Burg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acelon Chemicals and Fu Burg
The main advantage of trading using opposite Acelon Chemicals and Fu Burg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acelon Chemicals position performs unexpectedly, Fu Burg 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 Fu Burg will offset losses from the drop in Fu Burg's long position.| Acelon Chemicals vs. Honmyue Enterprise Co | Acelon Chemicals vs. Tainan Spinning Co | Acelon Chemicals vs. Chia Her Industrial | Acelon Chemicals vs. Zig Sheng Industrial |
| Fu Burg vs. Acelon Chemicals Fiber | Fu Burg vs. Phoenix Silicon International | Fu Burg vs. Qualipoly Chemical Corp | Fu Burg vs. JSL Construction Development |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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