Correlation Between Zhongfu Information and Fuda Alloy
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By analyzing existing cross correlation between Zhongfu Information and Fuda Alloy Materials, you can compare the effects of market volatilities on Zhongfu Information and Fuda Alloy 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 Zhongfu Information with a short position of Fuda Alloy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongfu Information and Fuda Alloy.
Diversification Opportunities for Zhongfu Information and Fuda Alloy
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhongfu and Fuda is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Zhongfu Information and Fuda Alloy Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuda Alloy Materials and Zhongfu Information 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 Zhongfu Information are associated (or correlated) with Fuda Alloy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuda Alloy Materials has no effect on the direction of Zhongfu Information i.e., Zhongfu Information and Fuda Alloy go up and down completely randomly.
Pair Corralation between Zhongfu Information and Fuda Alloy
Assuming the 90 days trading horizon Zhongfu Information is expected to under-perform the Fuda Alloy. But the stock apears to be less risky and, when comparing its historical volatility, Zhongfu Information is 1.09 times less risky than Fuda Alloy. The stock trades about -0.33 of its potential returns per unit of risk. The Fuda Alloy Materials is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,376 in Fuda Alloy Materials on October 14, 2024 and sell it today you would lose (36.00) from holding Fuda Alloy Materials or give up 2.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongfu Information vs. Fuda Alloy Materials
Performance |
| Timeline |
| Zhongfu Information |
| Fuda Alloy Materials |
Zhongfu Information and Fuda Alloy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongfu Information and Fuda Alloy
The main advantage of trading using opposite Zhongfu Information and Fuda Alloy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongfu Information position performs unexpectedly, Fuda Alloy 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 Fuda Alloy will offset losses from the drop in Fuda Alloy's long position.| Zhongfu Information vs. Hygon Information Technology | Zhongfu Information vs. Dawning Information Industry | Zhongfu Information vs. Eastroc Beverage Group | Zhongfu Information vs. Offshore Oil Engineering |
| Fuda Alloy vs. Qiming Information Technology | Fuda Alloy vs. Zhejiang Publishing Media | Fuda Alloy vs. Sublime China Information | Fuda Alloy vs. Zhongfu Information |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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