Correlation Between Hubei Jumpcan and Fiberhome Telecommunicatio
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By analyzing existing cross correlation between Hubei Jumpcan Pharmaceutical and Fiberhome Telecommunication Technologies, you can compare the effects of market volatilities on Hubei Jumpcan and Fiberhome Telecommunicatio 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 Hubei Jumpcan with a short position of Fiberhome Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Jumpcan and Fiberhome Telecommunicatio.
Diversification Opportunities for Hubei Jumpcan and Fiberhome Telecommunicatio
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hubei and Fiberhome is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Jumpcan Pharmaceutical and Fiberhome Telecommunication Te in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiberhome Telecommunicatio and Hubei Jumpcan 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 Hubei Jumpcan Pharmaceutical are associated (or correlated) with Fiberhome Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiberhome Telecommunicatio has no effect on the direction of Hubei Jumpcan i.e., Hubei Jumpcan and Fiberhome Telecommunicatio go up and down completely randomly.
Pair Corralation between Hubei Jumpcan and Fiberhome Telecommunicatio
Assuming the 90 days trading horizon Hubei Jumpcan Pharmaceutical is expected to under-perform the Fiberhome Telecommunicatio. But the stock apears to be less risky and, when comparing its historical volatility, Hubei Jumpcan Pharmaceutical is 2.14 times less risky than Fiberhome Telecommunicatio. The stock trades about -0.22 of its potential returns per unit of risk. The Fiberhome Telecommunication Technologies is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 1,839 in Fiberhome Telecommunication Technologies on October 7, 2024 and sell it today you would lose (114.00) from holding Fiberhome Telecommunication Technologies or give up 6.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Jumpcan Pharmaceutical vs. Fiberhome Telecommunication Te
Performance |
| Timeline |
| Hubei Jumpcan Pharma |
| Fiberhome Telecommunicatio |
Hubei Jumpcan and Fiberhome Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Jumpcan and Fiberhome Telecommunicatio
The main advantage of trading using opposite Hubei Jumpcan and Fiberhome Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Jumpcan position performs unexpectedly, Fiberhome Telecommunicatio 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 Fiberhome Telecommunicatio will offset losses from the drop in Fiberhome Telecommunicatio's long position.| Hubei Jumpcan vs. Nanjing Putian Telecommunications | Hubei Jumpcan vs. Tianjin Realty Development | Hubei Jumpcan vs. Zhongtong Guomai Communication | Hubei Jumpcan vs. Gansu Jiu Steel |
| Fiberhome Telecommunicatio vs. PetroChina Co Ltd | Fiberhome Telecommunicatio vs. Gansu Jiu Steel | Fiberhome Telecommunicatio vs. Aba Chemicals Corp | Fiberhome Telecommunicatio vs. Yes Optoelectronics Co |
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