Correlation Between Guangdong Marubi and Fuda Alloy
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By analyzing existing cross correlation between Guangdong Marubi Biotechnology and Fuda Alloy Materials, you can compare the effects of market volatilities on Guangdong Marubi and Fuda Alloy 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 Guangdong Marubi with a short position of Fuda Alloy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Marubi and Fuda Alloy.
Diversification Opportunities for Guangdong Marubi and Fuda Alloy
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Guangdong and Fuda is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Marubi Biotechnology and Fuda Alloy Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuda Alloy Materials and Guangdong Marubi 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 Guangdong Marubi Biotechnology are associated (or correlated) with Fuda Alloy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuda Alloy Materials has no effect on the direction of Guangdong Marubi i.e., Guangdong Marubi and Fuda Alloy go up and down completely randomly.
Pair Corralation between Guangdong Marubi and Fuda Alloy
Assuming the 90 days trading horizon Guangdong Marubi is expected to generate 5.46 times less return on investment than Fuda Alloy. But when comparing it to its historical volatility, Guangdong Marubi Biotechnology is 1.82 times less risky than Fuda Alloy. It trades about 0.13 of its potential returns per unit of risk. Fuda Alloy Materials is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 1,202 in Fuda Alloy Materials on November 5, 2024 and sell it today you would earn a total of 315.00 from holding Fuda Alloy Materials or generate 26.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Marubi Biotechnology vs. Fuda Alloy Materials
Performance |
| Timeline |
| Guangdong Marubi Bio |
| Fuda Alloy Materials |
Guangdong Marubi and Fuda Alloy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Marubi and Fuda Alloy
The main advantage of trading using opposite Guangdong Marubi and Fuda Alloy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Marubi position performs unexpectedly, Fuda Alloy 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 Fuda Alloy will offset losses from the drop in Fuda Alloy's long position.| Guangdong Marubi vs. Kweichow Moutai Co | Guangdong Marubi vs. Shenzhen Mindray Bio Medical | Guangdong Marubi vs. Jiangsu Pacific Quartz | Guangdong Marubi vs. G bits Network Technology |
| Fuda Alloy vs. Linewell Software Co | Fuda Alloy vs. Dareway Software Co | Fuda Alloy vs. Silkroad Visual Technology | Fuda Alloy vs. Road Environment Technology |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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