Correlation Between Fbec Worldwide and China Resources
Can any of the company-specific risk be diversified away by investing in both Fbec Worldwide and China Resources 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 Fbec Worldwide and China Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fbec Worldwide and China Resources Beer, you can compare the effects of market volatilities on Fbec Worldwide and China Resources 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 Fbec Worldwide with a short position of China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fbec Worldwide and China Resources.
Diversification Opportunities for Fbec Worldwide and China Resources
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fbec and China is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Fbec Worldwide and China Resources Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Beer and Fbec Worldwide 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 Fbec Worldwide are associated (or correlated) with China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Beer has no effect on the direction of Fbec Worldwide i.e., Fbec Worldwide and China Resources go up and down completely randomly.
Pair Corralation between Fbec Worldwide and China Resources
Given the investment horizon of 90 days Fbec Worldwide is expected to generate 35.74 times more return on investment than China Resources. However, Fbec Worldwide is 35.74 times more volatile than China Resources Beer. It trades about 0.13 of its potential returns per unit of risk. China Resources Beer is currently generating about -0.04 per unit of risk. If you would invest 0.03 in Fbec Worldwide on September 5, 2024 and sell it today you would earn a total of 0.04 from holding Fbec Worldwide or generate 133.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fbec Worldwide vs. China Resources Beer
Performance |
| Timeline |
| Fbec Worldwide |
| China Resources Beer |
Fbec Worldwide and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fbec Worldwide and China Resources
The main advantage of trading using opposite Fbec Worldwide and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fbec Worldwide position performs unexpectedly, China Resources 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 China Resources will offset losses from the drop in China Resources' long position.| Fbec Worldwide vs. Flow Beverage Corp | Fbec Worldwide vs. Barfresh Food Group | Fbec Worldwide vs. Hill Street Beverage | Fbec Worldwide vs. DNA Brands |
| China Resources vs. Tsingtao Brewery Co | China Resources vs. Budweiser Brewing | China Resources vs. Boston Beer | China Resources vs. Anheuser Busch Inbev |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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