Correlation Between Sichuan Furong and Western Mining
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By analyzing existing cross correlation between Sichuan Furong Technology and Western Mining Co, you can compare the effects of market volatilities on Sichuan Furong and Western Mining 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 Sichuan Furong with a short position of Western Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Furong and Western Mining.
Diversification Opportunities for Sichuan Furong and Western Mining
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sichuan and Western is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Furong Technology and Western Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Mining and Sichuan Furong 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 Sichuan Furong Technology are associated (or correlated) with Western Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Mining has no effect on the direction of Sichuan Furong i.e., Sichuan Furong and Western Mining go up and down completely randomly.
Pair Corralation between Sichuan Furong and Western Mining
Assuming the 90 days trading horizon Sichuan Furong Technology is expected to under-perform the Western Mining. In addition to that, Sichuan Furong is 1.77 times more volatile than Western Mining Co. It trades about -0.18 of its total potential returns per unit of risk. Western Mining Co is currently generating about 0.21 per unit of volatility. If you would invest 1,637 in Western Mining Co on October 17, 2024 and sell it today you would earn a total of 102.00 from holding Western Mining Co or generate 6.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Furong Technology vs. Western Mining Co
Performance |
| Timeline |
| Sichuan Furong Technology |
| Western Mining |
Sichuan Furong and Western Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Furong and Western Mining
The main advantage of trading using opposite Sichuan Furong and Western Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Furong position performs unexpectedly, Western Mining 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 Western Mining will offset losses from the drop in Western Mining's long position.| Sichuan Furong vs. Allgens Medical Technology | Sichuan Furong vs. Kontour Medical Technology | Sichuan Furong vs. Jinhe Biotechnology Co | Sichuan Furong vs. Liaoning Chengda Biotechnology |
| Western Mining vs. Dosilicon Co | Western Mining vs. Longxing Chemical Stock | Western Mining vs. Mengtian Home Group | Western Mining vs. Shandong Rike Chemical |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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