Correlation Between FarGlory Hotel and MacroWell OMG
Can any of the company-specific risk be diversified away by investing in both FarGlory Hotel and MacroWell OMG 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 FarGlory Hotel and MacroWell OMG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FarGlory Hotel Co and MacroWell OMG Digital, you can compare the effects of market volatilities on FarGlory Hotel and MacroWell OMG 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 FarGlory Hotel with a short position of MacroWell OMG. Check out your portfolio center. Please also check ongoing floating volatility patterns of FarGlory Hotel and MacroWell OMG.
Diversification Opportunities for FarGlory Hotel and MacroWell OMG
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FarGlory and MacroWell is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding FarGlory Hotel Co and MacroWell OMG Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MacroWell OMG Digital and FarGlory Hotel 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 FarGlory Hotel Co are associated (or correlated) with MacroWell OMG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MacroWell OMG Digital has no effect on the direction of FarGlory Hotel i.e., FarGlory Hotel and MacroWell OMG go up and down completely randomly.
Pair Corralation between FarGlory Hotel and MacroWell OMG
Assuming the 90 days trading horizon FarGlory Hotel Co is expected to generate 0.81 times more return on investment than MacroWell OMG. However, FarGlory Hotel Co is 1.23 times less risky than MacroWell OMG. It trades about -0.14 of its potential returns per unit of risk. MacroWell OMG Digital is currently generating about -0.27 per unit of risk. If you would invest 2,610 in FarGlory Hotel Co on September 4, 2024 and sell it today you would lose (130.00) from holding FarGlory Hotel Co or give up 4.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
FarGlory Hotel Co vs. MacroWell OMG Digital
Performance |
| Timeline |
| FarGlory Hotel |
| MacroWell OMG Digital |
FarGlory Hotel and MacroWell OMG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FarGlory Hotel and MacroWell OMG
The main advantage of trading using opposite FarGlory Hotel and MacroWell OMG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FarGlory Hotel position performs unexpectedly, MacroWell OMG 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 MacroWell OMG will offset losses from the drop in MacroWell OMG's long position.| FarGlory Hotel vs. Ambassador Hotel | FarGlory Hotel vs. Lion Travel Service | FarGlory Hotel vs. Chateau International Development | FarGlory Hotel vs. First Hotel Co |
| MacroWell OMG vs. U Ming Marine Transport | MacroWell OMG vs. Microelectronics Technology | MacroWell OMG vs. TMP Steel | MacroWell OMG vs. Vate Technology 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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