Correlation Between ANGLO ASIAN and FUYO GENERAL
Can any of the company-specific risk be diversified away by investing in both ANGLO ASIAN and FUYO GENERAL 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 ANGLO ASIAN and FUYO GENERAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANGLO ASIAN MINING and FUYO GENERAL LEASE, you can compare the effects of market volatilities on ANGLO ASIAN and FUYO GENERAL 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 ANGLO ASIAN with a short position of FUYO GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANGLO ASIAN and FUYO GENERAL.
Diversification Opportunities for ANGLO ASIAN and FUYO GENERAL
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ANGLO and FUYO is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding ANGLO ASIAN MINING and FUYO GENERAL LEASE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUYO GENERAL LEASE and ANGLO ASIAN 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 ANGLO ASIAN MINING are associated (or correlated) with FUYO GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUYO GENERAL LEASE has no effect on the direction of ANGLO ASIAN i.e., ANGLO ASIAN and FUYO GENERAL go up and down completely randomly.
Pair Corralation between ANGLO ASIAN and FUYO GENERAL
Assuming the 90 days trading horizon ANGLO ASIAN MINING is expected to generate 2.34 times more return on investment than FUYO GENERAL. However, ANGLO ASIAN is 2.34 times more volatile than FUYO GENERAL LEASE. It trades about 0.09 of its potential returns per unit of risk. FUYO GENERAL LEASE is currently generating about 0.01 per unit of risk. If you would invest 105.00 in ANGLO ASIAN MINING on October 18, 2024 and sell it today you would earn a total of 20.00 from holding ANGLO ASIAN MINING or generate 19.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANGLO ASIAN MINING vs. FUYO GENERAL LEASE
Performance |
| Timeline |
| ANGLO ASIAN MINING |
| FUYO GENERAL LEASE |
ANGLO ASIAN and FUYO GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANGLO ASIAN and FUYO GENERAL
The main advantage of trading using opposite ANGLO ASIAN and FUYO GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANGLO ASIAN position performs unexpectedly, FUYO GENERAL 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 FUYO GENERAL will offset losses from the drop in FUYO GENERAL's long position.| ANGLO ASIAN vs. RYANAIR HLDGS ADR | ANGLO ASIAN vs. Coffee Holding Co | ANGLO ASIAN vs. VARIOUS EATERIES LS | ANGLO ASIAN vs. Darden Restaurants |
| FUYO GENERAL vs. Burlington Stores | FUYO GENERAL vs. MINCO SILVER | FUYO GENERAL vs. Endeavour Mining PLC | FUYO GENERAL vs. ANGLO ASIAN MINING |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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