Correlation Between Fubon Financial and Healthconn Corp
Can any of the company-specific risk be diversified away by investing in both Fubon Financial and Healthconn Corp 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 Healthconn Corp 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 Healthconn Corp, you can compare the effects of market volatilities on Fubon Financial and Healthconn Corp 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 Healthconn Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon Financial and Healthconn Corp.
Diversification Opportunities for Fubon Financial and Healthconn Corp
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fubon and Healthconn is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Fubon Financial Holding and Healthconn Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthconn Corp 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 Healthconn Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthconn Corp has no effect on the direction of Fubon Financial i.e., Fubon Financial and Healthconn Corp go up and down completely randomly.
Pair Corralation between Fubon Financial and Healthconn Corp
Assuming the 90 days trading horizon Fubon Financial Holding is expected to generate 0.08 times more return on investment than Healthconn Corp. However, Fubon Financial Holding is 12.81 times less risky than Healthconn Corp. It trades about 0.25 of its potential returns per unit of risk. Healthconn Corp is currently generating about -0.25 per unit of risk. If you would invest 6,270 in Fubon Financial Holding on September 12, 2024 and sell it today you would earn a total of 40.00 from holding Fubon Financial Holding or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fubon Financial Holding vs. Healthconn Corp
Performance |
| Timeline |
| Fubon Financial Holding |
| Healthconn Corp |
Fubon Financial and Healthconn Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon Financial and Healthconn Corp
The main advantage of trading using opposite Fubon Financial and Healthconn Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon Financial position performs unexpectedly, Healthconn Corp 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 Healthconn Corp will offset losses from the drop in Healthconn Corp's long position.| Fubon Financial vs. Cathay Financial Holding | Fubon Financial vs. Cathay Financial Holding | Fubon Financial vs. CTBC Financial Holding | Fubon Financial vs. Mercuries Life Insurance |
| Healthconn Corp vs. YuantaP shares Taiwan Electronics | Healthconn Corp vs. YuantaP shares Taiwan Mid Cap | Healthconn Corp vs. YuantaP shares Taiwan Top | Healthconn Corp vs. Fubon MSCI Taiwan |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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