Correlation Between Fujian Oriental and Fujian Boss
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By analyzing existing cross correlation between Fujian Oriental Silver and Fujian Boss Software, you can compare the effects of market volatilities on Fujian Oriental and Fujian Boss 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 Fujian Oriental with a short position of Fujian Boss. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Oriental and Fujian Boss.
Diversification Opportunities for Fujian Oriental and Fujian Boss
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fujian and Fujian is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Oriental Silver and Fujian Boss Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Boss Software and Fujian Oriental 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 Fujian Oriental Silver are associated (or correlated) with Fujian Boss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Boss Software has no effect on the direction of Fujian Oriental i.e., Fujian Oriental and Fujian Boss go up and down completely randomly.
Pair Corralation between Fujian Oriental and Fujian Boss
Assuming the 90 days trading horizon Fujian Oriental Silver is expected to under-perform the Fujian Boss. In addition to that, Fujian Oriental is 1.24 times more volatile than Fujian Boss Software. It trades about -0.18 of its total potential returns per unit of risk. Fujian Boss Software is currently generating about 0.31 per unit of volatility. If you would invest 1,429 in Fujian Boss Software on November 20, 2024 and sell it today you would earn a total of 281.00 from holding Fujian Boss Software or generate 19.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Fujian Oriental Silver vs. Fujian Boss Software
Performance |
Timeline |
Fujian Oriental Silver |
Fujian Boss Software |
Fujian Oriental and Fujian Boss Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fujian Oriental and Fujian Boss
The main advantage of trading using opposite Fujian Oriental and Fujian Boss positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Oriental position performs unexpectedly, Fujian Boss 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 Fujian Boss will offset losses from the drop in Fujian Boss' long position.Fujian Oriental vs. Hubei Huaqiang High Tech | ||
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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