Correlation Between FDC International and Quintain Steel
Can any of the company-specific risk be diversified away by investing in both FDC International and Quintain Steel 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 FDC International and Quintain Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FDC International Hotels and Quintain Steel Co, you can compare the effects of market volatilities on FDC International and Quintain Steel 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 FDC International with a short position of Quintain Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of FDC International and Quintain Steel.
Diversification Opportunities for FDC International and Quintain Steel
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FDC and Quintain is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding FDC International Hotels and Quintain Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quintain Steel and FDC International 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 FDC International Hotels are associated (or correlated) with Quintain Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quintain Steel has no effect on the direction of FDC International i.e., FDC International and Quintain Steel go up and down completely randomly.
Pair Corralation between FDC International and Quintain Steel
Assuming the 90 days trading horizon FDC International Hotels is expected to generate 1.32 times more return on investment than Quintain Steel. However, FDC International is 1.32 times more volatile than Quintain Steel Co. It trades about -0.02 of its potential returns per unit of risk. Quintain Steel Co is currently generating about -0.26 per unit of risk. If you would invest 6,160 in FDC International Hotels on August 29, 2024 and sell it today you would lose (80.00) from holding FDC International Hotels or give up 1.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FDC International Hotels vs. Quintain Steel Co
Performance |
| Timeline |
| FDC International Hotels |
| Quintain Steel |
FDC International and Quintain Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FDC International and Quintain Steel
The main advantage of trading using opposite FDC International and Quintain Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FDC International position performs unexpectedly, Quintain Steel 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 Quintain Steel will offset losses from the drop in Quintain Steel's long position.| FDC International vs. Yulon Finance Corp | FDC International vs. Taiwan Secom Co | FDC International vs. Pou Chen Corp | FDC International vs. Great Wall Enterprise |
| Quintain Steel vs. China Man Made Fiber | Quintain Steel vs. USI Corp | Quintain Steel vs. China Petrochemical Development | Quintain Steel vs. Yulon Motor 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 CEOs Directory module to screen CEOs from public companies around the world.
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