Correlation Between Fiberhome Telecommunicatio and CICC Fund
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By analyzing existing cross correlation between Fiberhome Telecommunication Technologies and CICC Fund Management, you can compare the effects of market volatilities on Fiberhome Telecommunicatio and CICC Fund 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 Fiberhome Telecommunicatio with a short position of CICC Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiberhome Telecommunicatio and CICC Fund.
Diversification Opportunities for Fiberhome Telecommunicatio and CICC Fund
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fiberhome and CICC is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Fiberhome Telecommunication Te and CICC Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CICC Fund Management and Fiberhome Telecommunicatio 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 Fiberhome Telecommunication Technologies are associated (or correlated) with CICC Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CICC Fund Management has no effect on the direction of Fiberhome Telecommunicatio i.e., Fiberhome Telecommunicatio and CICC Fund go up and down completely randomly.
Pair Corralation between Fiberhome Telecommunicatio and CICC Fund
Assuming the 90 days trading horizon Fiberhome Telecommunicatio is expected to generate 3.39 times less return on investment than CICC Fund. In addition to that, Fiberhome Telecommunicatio is 2.3 times more volatile than CICC Fund Management. It trades about 0.04 of its total potential returns per unit of risk. CICC Fund Management is currently generating about 0.35 per unit of volatility. If you would invest 327.00 in CICC Fund Management on October 30, 2024 and sell it today you would earn a total of 63.00 from holding CICC Fund Management or generate 19.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fiberhome Telecommunication Te vs. CICC Fund Management
Performance |
| Timeline |
| Fiberhome Telecommunicatio |
| CICC Fund Management |
Fiberhome Telecommunicatio and CICC Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fiberhome Telecommunicatio and CICC Fund
The main advantage of trading using opposite Fiberhome Telecommunicatio and CICC Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fiberhome Telecommunicatio position performs unexpectedly, CICC Fund 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 CICC Fund will offset losses from the drop in CICC Fund's long position.The idea behind Fiberhome Telecommunication Technologies and CICC Fund Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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