Correlation Between Andes Technology and Fulgent Sun
Can any of the company-specific risk be diversified away by investing in both Andes Technology and Fulgent Sun 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 Andes Technology and Fulgent Sun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Andes Technology Corp and Fulgent Sun International, you can compare the effects of market volatilities on Andes Technology and Fulgent Sun 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 Andes Technology with a short position of Fulgent Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Andes Technology and Fulgent Sun.
Diversification Opportunities for Andes Technology and Fulgent Sun
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Andes and Fulgent is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Andes Technology Corp and Fulgent Sun International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fulgent Sun International and Andes Technology 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 Andes Technology Corp are associated (or correlated) with Fulgent Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fulgent Sun International has no effect on the direction of Andes Technology i.e., Andes Technology and Fulgent Sun go up and down completely randomly.
Pair Corralation between Andes Technology and Fulgent Sun
Assuming the 90 days trading horizon Andes Technology Corp is expected to generate 1.41 times more return on investment than Fulgent Sun. However, Andes Technology is 1.41 times more volatile than Fulgent Sun International. It trades about -0.01 of its potential returns per unit of risk. Fulgent Sun International is currently generating about -0.02 per unit of risk. If you would invest 42,750 in Andes Technology Corp on August 29, 2024 and sell it today you would lose (6,600) from holding Andes Technology Corp or give up 15.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Andes Technology Corp vs. Fulgent Sun International
Performance |
| Timeline |
| Andes Technology Corp |
| Fulgent Sun International |
Andes Technology and Fulgent Sun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Andes Technology and Fulgent Sun
The main advantage of trading using opposite Andes Technology and Fulgent Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Andes Technology position performs unexpectedly, Fulgent Sun 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 Fulgent Sun will offset losses from the drop in Fulgent Sun's long position.| Andes Technology vs. Maxigen Biotech | Andes Technology vs. AzureWave Technologies | Andes Technology vs. MedFirst Healthcare Services | Andes Technology vs. Chicony Power Technology |
| Fulgent Sun vs. Feng Tay Enterprises | Fulgent Sun vs. Pou Chen Corp | Fulgent Sun vs. Taiwan Paiho | Fulgent Sun vs. Merida Industry 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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