Correlation Between Farglory FTZ and Hi Lai
Can any of the company-specific risk be diversified away by investing in both Farglory FTZ and Hi Lai 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 Farglory FTZ and Hi Lai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Farglory FTZ Investment and Hi Lai Foods Co, you can compare the effects of market volatilities on Farglory FTZ and Hi Lai 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 Farglory FTZ with a short position of Hi Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farglory FTZ and Hi Lai.
Diversification Opportunities for Farglory FTZ and Hi Lai
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Farglory and 1268 is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Farglory FTZ Investment and Hi Lai Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hi Lai Foods and Farglory FTZ 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 Farglory FTZ Investment are associated (or correlated) with Hi Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hi Lai Foods has no effect on the direction of Farglory FTZ i.e., Farglory FTZ and Hi Lai go up and down completely randomly.
Pair Corralation between Farglory FTZ and Hi Lai
Assuming the 90 days trading horizon Farglory FTZ Investment is expected to under-perform the Hi Lai. In addition to that, Farglory FTZ is 1.53 times more volatile than Hi Lai Foods Co. It trades about -0.02 of its total potential returns per unit of risk. Hi Lai Foods Co is currently generating about 0.04 per unit of volatility. If you would invest 13,206 in Hi Lai Foods Co on September 12, 2024 and sell it today you would earn a total of 1,844 from holding Hi Lai Foods Co or generate 13.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Farglory FTZ Investment vs. Hi Lai Foods Co
Performance |
| Timeline |
| Farglory FTZ Investment |
| Hi Lai Foods |
Farglory FTZ and Hi Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farglory FTZ and Hi Lai
The main advantage of trading using opposite Farglory FTZ and Hi Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farglory FTZ position performs unexpectedly, Hi Lai 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 Hi Lai will offset losses from the drop in Hi Lai's long position.| Farglory FTZ vs. Yang Ming Marine | Farglory FTZ vs. Wan Hai Lines | Farglory FTZ vs. U Ming Marine Transport | Farglory FTZ vs. Taiwan Navigation Co |
| Hi Lai vs. Farglory FTZ Investment | Hi Lai vs. Shanghai Commercial Savings | Hi Lai vs. STARLUX Airlines Co | Hi Lai vs. Cowealth Medical Holding |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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