Correlation Between China Times and Fubon MSCI
Can any of the company-specific risk be diversified away by investing in both China Times and Fubon MSCI 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 China Times and Fubon MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Times Publishing and Fubon MSCI Taiwan, you can compare the effects of market volatilities on China Times and Fubon MSCI 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 China Times with a short position of Fubon MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Times and Fubon MSCI.
Diversification Opportunities for China Times and Fubon MSCI
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Fubon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Times Publishing and Fubon MSCI Taiwan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fubon MSCI Taiwan and China Times 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 China Times Publishing are associated (or correlated) with Fubon MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fubon MSCI Taiwan has no effect on the direction of China Times i.e., China Times and Fubon MSCI go up and down completely randomly.
Pair Corralation between China Times and Fubon MSCI
Assuming the 90 days trading horizon China Times Publishing is expected to generate 2.37 times more return on investment than Fubon MSCI. However, China Times is 2.37 times more volatile than Fubon MSCI Taiwan. It trades about 0.04 of its potential returns per unit of risk. Fubon MSCI Taiwan is currently generating about -0.02 per unit of risk. If you would invest 1,800 in China Times Publishing on September 4, 2024 and sell it today you would earn a total of 30.00 from holding China Times Publishing or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Times Publishing vs. Fubon MSCI Taiwan
Performance |
| Timeline |
| China Times Publishing |
| Fubon MSCI Taiwan |
China Times and Fubon MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Times and Fubon MSCI
The main advantage of trading using opposite China Times and Fubon MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Times position performs unexpectedly, Fubon MSCI 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 Fubon MSCI will offset losses from the drop in Fubon MSCI's long position.| China Times vs. Fubon MSCI Taiwan | China Times vs. YuantaP shares Taiwan Top | China Times vs. YuantaP shares Taiwan Electronics | China Times vs. YuantaP shares Taiwan Mid Cap |
| Fubon MSCI vs. Cathay Taiwan 5G | Fubon MSCI vs. Ruentex Development Co | Fubon MSCI vs. Symtek Automation Asia | Fubon MSCI vs. CTCI Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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