Correlation Between Fubon Financial and Synmosa Biopharma
Can any of the company-specific risk be diversified away by investing in both Fubon Financial and Synmosa Biopharma 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 Fubon Financial and Synmosa Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fubon Financial Holding and Synmosa Biopharma, you can compare the effects of market volatilities on Fubon Financial and Synmosa Biopharma 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 Fubon Financial with a short position of Synmosa Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon Financial and Synmosa Biopharma.
Diversification Opportunities for Fubon Financial and Synmosa Biopharma
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fubon and Synmosa is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Fubon Financial Holding and Synmosa Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synmosa Biopharma and Fubon Financial 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 Fubon Financial Holding are associated (or correlated) with Synmosa Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synmosa Biopharma has no effect on the direction of Fubon Financial i.e., Fubon Financial and Synmosa Biopharma go up and down completely randomly.
Pair Corralation between Fubon Financial and Synmosa Biopharma
Assuming the 90 days trading horizon Fubon Financial is expected to generate 360.21 times less return on investment than Synmosa Biopharma. But when comparing it to its historical volatility, Fubon Financial Holding is 111.92 times less risky than Synmosa Biopharma. It trades about 0.01 of its potential returns per unit of risk. Synmosa Biopharma is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,613 in Synmosa Biopharma on September 2, 2024 and sell it today you would lose (183.00) from holding Synmosa Biopharma or give up 5.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fubon Financial Holding vs. Synmosa Biopharma
Performance |
| Timeline |
| Fubon Financial Holding |
| Synmosa Biopharma |
Fubon Financial and Synmosa Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon Financial and Synmosa Biopharma
The main advantage of trading using opposite Fubon Financial and Synmosa Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon Financial position performs unexpectedly, Synmosa Biopharma 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 Synmosa Biopharma will offset losses from the drop in Synmosa Biopharma's long position.| Fubon Financial vs. Taiwan Cooperative Financial | Fubon Financial vs. Hannstar Display Corp | Fubon Financial vs. RiTdisplay Corp | Fubon Financial vs. Sinopac Financial Holdings |
| Synmosa Biopharma vs. Compal Broadband Networks | Synmosa Biopharma vs. Asustek Computer | Synmosa Biopharma vs. Lian Hwa Foods | Synmosa Biopharma vs. Far EasTone Telecommunications |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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