Correlation Between Farglory FTZ and Andes Technology
Can any of the company-specific risk be diversified away by investing in both Farglory FTZ and Andes Technology 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 Andes Technology 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 Andes Technology Corp, you can compare the effects of market volatilities on Farglory FTZ and Andes Technology 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 Andes Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farglory FTZ and Andes Technology.
Diversification Opportunities for Farglory FTZ and Andes Technology
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Farglory and Andes is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Farglory FTZ Investment and Andes Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andes Technology Corp 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 Andes Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andes Technology Corp has no effect on the direction of Farglory FTZ i.e., Farglory FTZ and Andes Technology go up and down completely randomly.
Pair Corralation between Farglory FTZ and Andes Technology
Assuming the 90 days trading horizon Farglory FTZ Investment is expected to generate 0.54 times more return on investment than Andes Technology. However, Farglory FTZ Investment is 1.86 times less risky than Andes Technology. It trades about 0.04 of its potential returns per unit of risk. Andes Technology Corp is currently generating about -0.12 per unit of risk. If you would invest 4,400 in Farglory FTZ Investment on August 26, 2024 and sell it today you would earn a total of 40.00 from holding Farglory FTZ Investment or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Farglory FTZ Investment vs. Andes Technology Corp
Performance |
| Timeline |
| Farglory FTZ Investment |
| Andes Technology Corp |
Farglory FTZ and Andes Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farglory FTZ and Andes Technology
The main advantage of trading using opposite Farglory FTZ and Andes Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farglory FTZ position performs unexpectedly, Andes Technology 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 Andes Technology will offset losses from the drop in Andes Technology's long position.| Farglory FTZ vs. Evergreen International Storage | Farglory FTZ vs. China Container Terminal | Farglory FTZ vs. Sincere Navigation Corp | Farglory FTZ vs. CSBC Corp Taiwan |
| Andes Technology vs. Gigastorage Corp | Andes Technology vs. Trade Van Information Services | Andes Technology vs. Apex Biotechnology Corp | Andes Technology vs. SynCore Biotechnology Co |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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