Correlation Between Concord Securities and Grand Fortune
Can any of the company-specific risk be diversified away by investing in both Concord Securities and Grand Fortune at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Concord Securities and Grand Fortune into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concord Securities Co and Grand Fortune Securities, you can compare the effects of market volatilities on Concord Securities and Grand Fortune 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 Concord Securities with a short position of Grand Fortune. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Securities and Grand Fortune.
Diversification Opportunities for Concord Securities and Grand Fortune
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Concord and Grand is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Concord Securities Co and Grand Fortune Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Fortune Securities and Concord Securities 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 Concord Securities Co are associated (or correlated) with Grand Fortune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Fortune Securities has no effect on the direction of Concord Securities i.e., Concord Securities and Grand Fortune go up and down completely randomly.
Pair Corralation between Concord Securities and Grand Fortune
Assuming the 90 days trading horizon Concord Securities Co is expected to generate 1.65 times more return on investment than Grand Fortune. However, Concord Securities is 1.65 times more volatile than Grand Fortune Securities. It trades about 0.03 of its potential returns per unit of risk. Grand Fortune Securities is currently generating about 0.03 per unit of risk. If you would invest 1,224 in Concord Securities Co on September 14, 2024 and sell it today you would earn a total of 141.00 from holding Concord Securities Co or generate 11.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Concord Securities Co vs. Grand Fortune Securities
Performance |
| Timeline |
| Concord Securities |
| Grand Fortune Securities |
Concord Securities and Grand Fortune Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Securities and Grand Fortune
The main advantage of trading using opposite Concord Securities and Grand Fortune positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Securities position performs unexpectedly, Grand Fortune 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 Grand Fortune will offset losses from the drop in Grand Fortune's long position.| Concord Securities vs. Voltronic Power Technology | Concord Securities vs. Asmedia Technology | Concord Securities vs. Thermaltake Technology Co | Concord Securities vs. Asia Metal Industries |
| Grand Fortune vs. IBF Financial Holdings | Grand Fortune vs. Capital Securities Corp | Grand Fortune vs. President Securities Corp | Grand Fortune vs. China Bills Finance |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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