Correlation Between Fu Burg and Simple Mart
Can any of the company-specific risk be diversified away by investing in both Fu Burg and Simple Mart 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 Fu Burg and Simple Mart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fu Burg Industrial and Simple Mart Retail, you can compare the effects of market volatilities on Fu Burg and Simple Mart 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 Fu Burg with a short position of Simple Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fu Burg and Simple Mart.
Diversification Opportunities for Fu Burg and Simple Mart
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 8929 and Simple is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Fu Burg Industrial and Simple Mart Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simple Mart Retail and Fu Burg 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 Fu Burg Industrial are associated (or correlated) with Simple Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simple Mart Retail has no effect on the direction of Fu Burg i.e., Fu Burg and Simple Mart go up and down completely randomly.
Pair Corralation between Fu Burg and Simple Mart
Assuming the 90 days trading horizon Fu Burg Industrial is expected to generate 1.86 times more return on investment than Simple Mart. However, Fu Burg is 1.86 times more volatile than Simple Mart Retail. It trades about 0.06 of its potential returns per unit of risk. Simple Mart Retail is currently generating about 0.02 per unit of risk. If you would invest 2,175 in Fu Burg Industrial on September 2, 2024 and sell it today you would earn a total of 1,220 from holding Fu Burg Industrial or generate 56.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fu Burg Industrial vs. Simple Mart Retail
Performance |
| Timeline |
| Fu Burg Industrial |
| Simple Mart Retail |
Fu Burg and Simple Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fu Burg and Simple Mart
The main advantage of trading using opposite Fu Burg and Simple Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fu Burg position performs unexpectedly, Simple Mart 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 Simple Mart will offset losses from the drop in Simple Mart's long position.| Fu Burg vs. Gloria Material Technology | Fu Burg vs. Wei Chih Steel | Fu Burg vs. Daxin Materials Corp | Fu Burg vs. Nankang Rubber Tire |
| Simple Mart vs. Taiwan Semiconductor Manufacturing | Simple Mart vs. Hon Hai Precision | Simple Mart vs. MediaTek | Simple Mart vs. Chunghwa Telecom 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |