Correlation Between Fangda Special and Hefei Metalforming
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By analyzing existing cross correlation between Fangda Special Steel and Hefei Metalforming Mach, you can compare the effects of market volatilities on Fangda Special and Hefei Metalforming 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 Fangda Special with a short position of Hefei Metalforming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fangda Special and Hefei Metalforming.
Diversification Opportunities for Fangda Special and Hefei Metalforming
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fangda and Hefei is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Fangda Special Steel and Hefei Metalforming Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hefei Metalforming Mach and Fangda Special 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 Fangda Special Steel are associated (or correlated) with Hefei Metalforming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hefei Metalforming Mach has no effect on the direction of Fangda Special i.e., Fangda Special and Hefei Metalforming go up and down completely randomly.
Pair Corralation between Fangda Special and Hefei Metalforming
Assuming the 90 days trading horizon Fangda Special Steel is expected to generate 0.95 times more return on investment than Hefei Metalforming. However, Fangda Special Steel is 1.05 times less risky than Hefei Metalforming. It trades about 0.02 of its potential returns per unit of risk. Hefei Metalforming Mach is currently generating about 0.01 per unit of risk. If you would invest 410.00 in Fangda Special Steel on October 28, 2024 and sell it today you would earn a total of 2.00 from holding Fangda Special Steel or generate 0.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fangda Special Steel vs. Hefei Metalforming Mach
Performance |
| Timeline |
| Fangda Special Steel |
| Hefei Metalforming Mach |
Fangda Special and Hefei Metalforming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fangda Special and Hefei Metalforming
The main advantage of trading using opposite Fangda Special and Hefei Metalforming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fangda Special position performs unexpectedly, Hefei Metalforming 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 Hefei Metalforming will offset losses from the drop in Hefei Metalforming's long position.| Fangda Special vs. Shanghai V Test Semiconductor | Fangda Special vs. Peoples Insurance of | Fangda Special vs. Suzhou Oriental Semiconductor | Fangda Special vs. Panda Financial Holding |
| Hefei Metalforming vs. PetroChina Co Ltd | Hefei Metalforming vs. Industrial and Commercial | Hefei Metalforming vs. China Petroleum Chemical | Hefei Metalforming vs. China Construction Bank |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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