Correlation Between Fuyao Glass and Sinosteel Engineering
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By analyzing existing cross correlation between Fuyao Glass Industry and Sinosteel Engineering and, you can compare the effects of market volatilities on Fuyao Glass and Sinosteel Engineering 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 Fuyao Glass with a short position of Sinosteel Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fuyao Glass and Sinosteel Engineering.
Diversification Opportunities for Fuyao Glass and Sinosteel Engineering
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fuyao and Sinosteel is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Fuyao Glass Industry and Sinosteel Engineering and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinosteel Engineering and and Fuyao Glass 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 Fuyao Glass Industry are associated (or correlated) with Sinosteel Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinosteel Engineering and has no effect on the direction of Fuyao Glass i.e., Fuyao Glass and Sinosteel Engineering go up and down completely randomly.
Pair Corralation between Fuyao Glass and Sinosteel Engineering
Assuming the 90 days trading horizon Fuyao Glass Industry is expected to generate 0.54 times more return on investment than Sinosteel Engineering. However, Fuyao Glass Industry is 1.86 times less risky than Sinosteel Engineering. It trades about 0.07 of its potential returns per unit of risk. Sinosteel Engineering and is currently generating about 0.02 per unit of risk. If you would invest 3,580 in Fuyao Glass Industry on August 27, 2024 and sell it today you would earn a total of 2,021 from holding Fuyao Glass Industry or generate 56.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fuyao Glass Industry vs. Sinosteel Engineering and
Performance |
| Timeline |
| Fuyao Glass Industry |
| Sinosteel Engineering and |
Fuyao Glass and Sinosteel Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fuyao Glass and Sinosteel Engineering
The main advantage of trading using opposite Fuyao Glass and Sinosteel Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fuyao Glass position performs unexpectedly, Sinosteel Engineering 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 Sinosteel Engineering will offset losses from the drop in Sinosteel Engineering's long position.| Fuyao Glass vs. Sinosteel Engineering and | Fuyao Glass vs. Chongqing Brewery Co | Fuyao Glass vs. CICT Mobile Communication | Fuyao Glass vs. Runjian Communication Co |
| Sinosteel Engineering vs. Ming Yang Smart | Sinosteel Engineering vs. 159681 | Sinosteel Engineering vs. 159005 | Sinosteel Engineering vs. Loctek Ergonomic Technology |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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