Correlation Between EMQQ Emerging and FMQQ Next
Can any of the company-specific risk be diversified away by investing in both EMQQ Emerging and FMQQ Next 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 EMQQ Emerging and FMQQ Next into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMQQ The Emerging and FMQQ The Next, you can compare the effects of market volatilities on EMQQ Emerging and FMQQ Next 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 EMQQ Emerging with a short position of FMQQ Next. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMQQ Emerging and FMQQ Next.
Diversification Opportunities for EMQQ Emerging and FMQQ Next
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between EMQQ and FMQQ is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding EMQQ The Emerging and FMQQ The Next in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FMQQ The Next and EMQQ Emerging 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 EMQQ The Emerging are associated (or correlated) with FMQQ Next. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FMQQ The Next has no effect on the direction of EMQQ Emerging i.e., EMQQ Emerging and FMQQ Next go up and down completely randomly.
Pair Corralation between EMQQ Emerging and FMQQ Next
Given the investment horizon of 90 days EMQQ Emerging is expected to generate 1.04 times less return on investment than FMQQ Next. In addition to that, EMQQ Emerging is 1.47 times more volatile than FMQQ The Next. It trades about 0.05 of its total potential returns per unit of risk. FMQQ The Next is currently generating about 0.08 per unit of volatility. If you would invest 1,231 in FMQQ The Next on September 1, 2024 and sell it today you would earn a total of 122.00 from holding FMQQ The Next or generate 9.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EMQQ The Emerging vs. FMQQ The Next
Performance |
| Timeline |
| EMQQ The Emerging |
| FMQQ The Next |
EMQQ Emerging and FMQQ Next Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMQQ Emerging and FMQQ Next
The main advantage of trading using opposite EMQQ Emerging and FMQQ Next positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMQQ Emerging position performs unexpectedly, FMQQ Next 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 FMQQ Next will offset losses from the drop in FMQQ Next's long position.| EMQQ Emerging vs. Invesco China Technology | EMQQ Emerging vs. Amplify Online Retail | EMQQ Emerging vs. KraneShares CSI China | EMQQ Emerging vs. Global X MSCI |
| FMQQ Next vs. India Internet Ecommerce | FMQQ Next vs. EMQQ The Emerging | FMQQ Next vs. KraneShares California Carbon |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Global Correlations Find global opportunities by holding instruments from different markets |