Correlation Between Firan Technology and WUXI BIOLOGICS
Can any of the company-specific risk be diversified away by investing in both Firan Technology and WUXI BIOLOGICS 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 Firan Technology and WUXI BIOLOGICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firan Technology Group and WUXI BIOLOGICS UNSPADR2, you can compare the effects of market volatilities on Firan Technology and WUXI BIOLOGICS 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 Firan Technology with a short position of WUXI BIOLOGICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and WUXI BIOLOGICS.
Diversification Opportunities for Firan Technology and WUXI BIOLOGICS
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Firan and WUXI is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and WUXI BIOLOGICS UNSPADR2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WUXI BIOLOGICS UNSPADR2 and Firan Technology 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 Firan Technology Group are associated (or correlated) with WUXI BIOLOGICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WUXI BIOLOGICS UNSPADR2 has no effect on the direction of Firan Technology i.e., Firan Technology and WUXI BIOLOGICS go up and down completely randomly.
Pair Corralation between Firan Technology and WUXI BIOLOGICS
Assuming the 90 days trading horizon Firan Technology Group is expected to generate 0.44 times more return on investment than WUXI BIOLOGICS. However, Firan Technology Group is 2.26 times less risky than WUXI BIOLOGICS. It trades about 0.11 of its potential returns per unit of risk. WUXI BIOLOGICS UNSPADR2 is currently generating about 0.0 per unit of risk. If you would invest 272.00 in Firan Technology Group on October 16, 2024 and sell it today you would earn a total of 212.00 from holding Firan Technology Group or generate 77.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firan Technology Group vs. WUXI BIOLOGICS UNSPADR2
Performance |
| Timeline |
| Firan Technology |
| WUXI BIOLOGICS UNSPADR2 |
Firan Technology and WUXI BIOLOGICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firan Technology and WUXI BIOLOGICS
The main advantage of trading using opposite Firan Technology and WUXI BIOLOGICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, WUXI BIOLOGICS 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 WUXI BIOLOGICS will offset losses from the drop in WUXI BIOLOGICS's long position.| Firan Technology vs. ScanSource | Firan Technology vs. INSURANCE AUST GRP | Firan Technology vs. Insurance Australia Group | Firan Technology vs. The Hanover Insurance |
| WUXI BIOLOGICS vs. YOOMA WELLNESS INC | WUXI BIOLOGICS vs. HEALTHSTREAM | WUXI BIOLOGICS vs. CARDINAL HEALTH | WUXI BIOLOGICS vs. Wenzhou Kangning Hospital |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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