Correlation Between Dongnan Electronics and Fuzhou Rockchip
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By analyzing existing cross correlation between Dongnan Electronics Co and Fuzhou Rockchip Electronics, you can compare the effects of market volatilities on Dongnan Electronics and Fuzhou Rockchip 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 Dongnan Electronics with a short position of Fuzhou Rockchip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongnan Electronics and Fuzhou Rockchip.
Diversification Opportunities for Dongnan Electronics and Fuzhou Rockchip
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dongnan and Fuzhou is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Dongnan Electronics Co and Fuzhou Rockchip Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuzhou Rockchip Elec and Dongnan Electronics 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 Dongnan Electronics Co are associated (or correlated) with Fuzhou Rockchip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuzhou Rockchip Elec has no effect on the direction of Dongnan Electronics i.e., Dongnan Electronics and Fuzhou Rockchip go up and down completely randomly.
Pair Corralation between Dongnan Electronics and Fuzhou Rockchip
Assuming the 90 days trading horizon Dongnan Electronics Co is expected to under-perform the Fuzhou Rockchip. But the stock apears to be less risky and, when comparing its historical volatility, Dongnan Electronics Co is 1.22 times less risky than Fuzhou Rockchip. The stock trades about -0.05 of its potential returns per unit of risk. The Fuzhou Rockchip Electronics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,240 in Fuzhou Rockchip Electronics on September 13, 2024 and sell it today you would earn a total of 153.00 from holding Fuzhou Rockchip Electronics or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongnan Electronics Co vs. Fuzhou Rockchip Electronics
Performance |
| Timeline |
| Dongnan Electronics |
| Fuzhou Rockchip Elec |
Dongnan Electronics and Fuzhou Rockchip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongnan Electronics and Fuzhou Rockchip
The main advantage of trading using opposite Dongnan Electronics and Fuzhou Rockchip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongnan Electronics position performs unexpectedly, Fuzhou Rockchip 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 Fuzhou Rockchip will offset losses from the drop in Fuzhou Rockchip's long position.| Dongnan Electronics vs. Mingchen Health Co | Dongnan Electronics vs. Shenzhen Silver Basis | Dongnan Electronics vs. Lotus Health Group | Dongnan Electronics vs. Hangzhou Coco Healthcare |
| Fuzhou Rockchip vs. Nanjing Putian Telecommunications | Fuzhou Rockchip vs. Tianjin Realty Development | Fuzhou Rockchip vs. Kangyue Technology Co | Fuzhou Rockchip vs. Shenzhen Hifuture Electric |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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