Correlation Between REGAL ASIAN and FUYO GENERAL
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and FUYO GENERAL 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 REGAL ASIAN and FUYO GENERAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and FUYO GENERAL LEASE, you can compare the effects of market volatilities on REGAL ASIAN and FUYO GENERAL 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 REGAL ASIAN with a short position of FUYO GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and FUYO GENERAL.
Diversification Opportunities for REGAL ASIAN and FUYO GENERAL
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between REGAL and FUYO is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and FUYO GENERAL LEASE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUYO GENERAL LEASE and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with FUYO GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUYO GENERAL LEASE has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and FUYO GENERAL go up and down completely randomly.
Pair Corralation between REGAL ASIAN and FUYO GENERAL
Assuming the 90 days trading horizon REGAL ASIAN INVESTMENTS is expected to generate 1.01 times more return on investment than FUYO GENERAL. However, REGAL ASIAN is 1.01 times more volatile than FUYO GENERAL LEASE. It trades about 0.03 of its potential returns per unit of risk. FUYO GENERAL LEASE is currently generating about 0.01 per unit of risk. If you would invest 108.00 in REGAL ASIAN INVESTMENTS on August 31, 2024 and sell it today you would earn a total of 18.00 from holding REGAL ASIAN INVESTMENTS or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
REGAL ASIAN INVESTMENTS vs. FUYO GENERAL LEASE
Performance |
| Timeline |
| REGAL ASIAN INVESTMENTS |
| FUYO GENERAL LEASE |
REGAL ASIAN and FUYO GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL ASIAN and FUYO GENERAL
The main advantage of trading using opposite REGAL ASIAN and FUYO GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, FUYO GENERAL 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 FUYO GENERAL will offset losses from the drop in FUYO GENERAL's long position.| REGAL ASIAN vs. PICKN PAY STORES | REGAL ASIAN vs. Ross Stores | REGAL ASIAN vs. Perseus Mining Limited | REGAL ASIAN vs. GRIFFIN MINING LTD |
| FUYO GENERAL vs. United Rentals | FUYO GENERAL vs. Superior Plus Corp | FUYO GENERAL vs. NMI Holdings | FUYO GENERAL vs. Origin Agritech |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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