Correlation Between Fujian Forecam and Cangzhou Mingzhu
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By analyzing existing cross correlation between Fujian Forecam Optics and Cangzhou Mingzhu Plastic, you can compare the effects of market volatilities on Fujian Forecam and Cangzhou Mingzhu 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 Fujian Forecam with a short position of Cangzhou Mingzhu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Forecam and Cangzhou Mingzhu.
Diversification Opportunities for Fujian Forecam and Cangzhou Mingzhu
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fujian and Cangzhou is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Forecam Optics and Cangzhou Mingzhu Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cangzhou Mingzhu Plastic and Fujian Forecam 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 Fujian Forecam Optics are associated (or correlated) with Cangzhou Mingzhu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cangzhou Mingzhu Plastic has no effect on the direction of Fujian Forecam i.e., Fujian Forecam and Cangzhou Mingzhu go up and down completely randomly.
Pair Corralation between Fujian Forecam and Cangzhou Mingzhu
Assuming the 90 days trading horizon Fujian Forecam Optics is expected to generate 2.03 times more return on investment than Cangzhou Mingzhu. However, Fujian Forecam is 2.03 times more volatile than Cangzhou Mingzhu Plastic. It trades about 0.06 of its potential returns per unit of risk. Cangzhou Mingzhu Plastic is currently generating about 0.02 per unit of risk. If you would invest 2,526 in Fujian Forecam Optics on September 4, 2024 and sell it today you would earn a total of 1,133 from holding Fujian Forecam Optics or generate 44.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Forecam Optics vs. Cangzhou Mingzhu Plastic
Performance |
| Timeline |
| Fujian Forecam Optics |
| Cangzhou Mingzhu Plastic |
Fujian Forecam and Cangzhou Mingzhu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Forecam and Cangzhou Mingzhu
The main advantage of trading using opposite Fujian Forecam and Cangzhou Mingzhu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Forecam position performs unexpectedly, Cangzhou Mingzhu 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 Cangzhou Mingzhu will offset losses from the drop in Cangzhou Mingzhu's long position.| Fujian Forecam vs. BeiGene | Fujian Forecam vs. Kweichow Moutai Co | Fujian Forecam vs. Beijing Roborock Technology | Fujian Forecam vs. G bits Network Technology |
| Cangzhou Mingzhu vs. Zhejiang Kingland Pipeline | Cangzhou Mingzhu vs. Air China Ltd | Cangzhou Mingzhu vs. Fujian Forecam Optics | Cangzhou Mingzhu vs. iSoftStone Information 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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