Correlation Between Fibocom Wireless and Xiangyang Automobile
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By analyzing existing cross correlation between Fibocom Wireless and Xiangyang Automobile Bearing, you can compare the effects of market volatilities on Fibocom Wireless and Xiangyang Automobile 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 Fibocom Wireless with a short position of Xiangyang Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fibocom Wireless and Xiangyang Automobile.
Diversification Opportunities for Fibocom Wireless and Xiangyang Automobile
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fibocom and Xiangyang is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Fibocom Wireless and Xiangyang Automobile Bearing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyang Automobile and Fibocom Wireless 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 Fibocom Wireless are associated (or correlated) with Xiangyang Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyang Automobile has no effect on the direction of Fibocom Wireless i.e., Fibocom Wireless and Xiangyang Automobile go up and down completely randomly.
Pair Corralation between Fibocom Wireless and Xiangyang Automobile
Assuming the 90 days trading horizon Fibocom Wireless is expected to generate 0.91 times more return on investment than Xiangyang Automobile. However, Fibocom Wireless is 1.1 times less risky than Xiangyang Automobile. It trades about 0.03 of its potential returns per unit of risk. Xiangyang Automobile Bearing is currently generating about -0.16 per unit of risk. If you would invest 1,834 in Fibocom Wireless on October 16, 2024 and sell it today you would earn a total of 23.00 from holding Fibocom Wireless or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fibocom Wireless vs. Xiangyang Automobile Bearing
Performance |
| Timeline |
| Fibocom Wireless |
| Xiangyang Automobile |
Fibocom Wireless and Xiangyang Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fibocom Wireless and Xiangyang Automobile
The main advantage of trading using opposite Fibocom Wireless and Xiangyang Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fibocom Wireless position performs unexpectedly, Xiangyang Automobile 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 Xiangyang Automobile will offset losses from the drop in Xiangyang Automobile's long position.| Fibocom Wireless vs. Xiangyang Automobile Bearing | Fibocom Wireless vs. Yingde Greatchem Chemicals | Fibocom Wireless vs. Do Fluoride Chemicals Co | Fibocom Wireless vs. Yindu Kitchen Equipment |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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