Correlation Between Fanhua and CRAWFORD +
Can any of the company-specific risk be diversified away by investing in both Fanhua and CRAWFORD + 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 Fanhua and CRAWFORD + into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fanhua Inc and CRAWFORD A NV, you can compare the effects of market volatilities on Fanhua and CRAWFORD + 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 Fanhua with a short position of CRAWFORD +. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fanhua and CRAWFORD +.
Diversification Opportunities for Fanhua and CRAWFORD +
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fanhua and CRAWFORD is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Fanhua Inc and CRAWFORD A NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CRAWFORD A NV and Fanhua 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 Fanhua Inc are associated (or correlated) with CRAWFORD +. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CRAWFORD A NV has no effect on the direction of Fanhua i.e., Fanhua and CRAWFORD + go up and down completely randomly.
Pair Corralation between Fanhua and CRAWFORD +
Assuming the 90 days trading horizon Fanhua Inc is expected to under-perform the CRAWFORD +. In addition to that, Fanhua is 2.3 times more volatile than CRAWFORD A NV. It trades about -0.38 of its total potential returns per unit of risk. CRAWFORD A NV is currently generating about -0.01 per unit of volatility. If you would invest 1,050 in CRAWFORD A NV on October 11, 2024 and sell it today you would lose (10.00) from holding CRAWFORD A NV or give up 0.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fanhua Inc vs. CRAWFORD A NV
Performance |
| Timeline |
| Fanhua Inc |
| CRAWFORD A NV |
Fanhua and CRAWFORD + Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fanhua and CRAWFORD +
The main advantage of trading using opposite Fanhua and CRAWFORD + positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fanhua position performs unexpectedly, CRAWFORD + 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 CRAWFORD + will offset losses from the drop in CRAWFORD +'s long position.| Fanhua vs. Q2M Managementberatung AG | Fanhua vs. CeoTronics AG | Fanhua vs. Ares Management Corp | Fanhua vs. VITEC SOFTWARE GROUP |
| CRAWFORD + vs. Forsys Metals Corp | CRAWFORD + vs. Aluminum of | CRAWFORD + vs. GALENA MINING LTD | CRAWFORD + vs. SERI INDUSTRIAL EO |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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