Correlation Between Dongxing Sec and Fujian Newland
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By analyzing existing cross correlation between Dongxing Sec Co and Fujian Newland Computer, you can compare the effects of market volatilities on Dongxing Sec and Fujian Newland 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 Dongxing Sec with a short position of Fujian Newland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongxing Sec and Fujian Newland.
Diversification Opportunities for Dongxing Sec and Fujian Newland
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dongxing and Fujian is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Dongxing Sec Co and Fujian Newland Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Newland Computer and Dongxing Sec 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 Dongxing Sec Co are associated (or correlated) with Fujian Newland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Newland Computer has no effect on the direction of Dongxing Sec i.e., Dongxing Sec and Fujian Newland go up and down completely randomly.
Pair Corralation between Dongxing Sec and Fujian Newland
Assuming the 90 days trading horizon Dongxing Sec Co is expected to generate 1.18 times more return on investment than Fujian Newland. However, Dongxing Sec is 1.18 times more volatile than Fujian Newland Computer. It trades about -0.18 of its potential returns per unit of risk. Fujian Newland Computer is currently generating about -0.36 per unit of risk. If you would invest 1,193 in Dongxing Sec Co on October 12, 2024 and sell it today you would lose (127.00) from holding Dongxing Sec Co or give up 10.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongxing Sec Co vs. Fujian Newland Computer
Performance |
| Timeline |
| Dongxing Sec |
| Fujian Newland Computer |
Dongxing Sec and Fujian Newland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongxing Sec and Fujian Newland
The main advantage of trading using opposite Dongxing Sec and Fujian Newland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongxing Sec position performs unexpectedly, Fujian Newland 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 Newland will offset losses from the drop in Fujian Newland's long position.| Dongxing Sec vs. Shijiazhuang Tonhe Electronics | Dongxing Sec vs. Financial Street Holdings | Dongxing Sec vs. Agricultural Bank of | Dongxing Sec vs. Beijing YanDong MicroElectronic |
| Fujian Newland vs. China Life Insurance | Fujian Newland vs. Cinda Securities Co | Fujian Newland vs. Piotech Inc A | Fujian Newland vs. Dongxing Sec Co |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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