Correlation Between Qilu Bank and Fujian Longzhou
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By analyzing existing cross correlation between Qilu Bank Co and Fujian Longzhou Transportation, you can compare the effects of market volatilities on Qilu Bank and Fujian Longzhou 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 Qilu Bank with a short position of Fujian Longzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qilu Bank and Fujian Longzhou.
Diversification Opportunities for Qilu Bank and Fujian Longzhou
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Qilu and Fujian is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Qilu Bank Co and Fujian Longzhou Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Longzhou Tran and Qilu Bank 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 Qilu Bank Co are associated (or correlated) with Fujian Longzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Longzhou Tran has no effect on the direction of Qilu Bank i.e., Qilu Bank and Fujian Longzhou go up and down completely randomly.
Pair Corralation between Qilu Bank and Fujian Longzhou
Assuming the 90 days trading horizon Qilu Bank Co is expected to under-perform the Fujian Longzhou. But the stock apears to be less risky and, when comparing its historical volatility, Qilu Bank Co is 2.89 times less risky than Fujian Longzhou. The stock trades about -0.25 of its potential returns per unit of risk. The Fujian Longzhou Transportation is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 427.00 in Fujian Longzhou Transportation on September 5, 2024 and sell it today you would earn a total of 164.00 from holding Fujian Longzhou Transportation or generate 38.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qilu Bank Co vs. Fujian Longzhou Transportation
Performance |
| Timeline |
| Qilu Bank |
| Fujian Longzhou Tran |
Qilu Bank and Fujian Longzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qilu Bank and Fujian Longzhou
The main advantage of trading using opposite Qilu Bank and Fujian Longzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qilu Bank position performs unexpectedly, Fujian Longzhou 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 Longzhou will offset losses from the drop in Fujian Longzhou's long position.| Qilu Bank vs. Industrial and Commercial | Qilu Bank vs. Agricultural Bank of | Qilu Bank vs. China Construction Bank | Qilu Bank vs. Bank of China |
| Fujian Longzhou vs. Yunnan Jianzhijia Health Chain | Fujian Longzhou vs. Lotus Health Group | Fujian Longzhou vs. Everjoy Health Group | Fujian Longzhou vs. Shanghai Rongtai Health |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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