Correlation Between Focus Graphite and China Sun
Can any of the company-specific risk be diversified away by investing in both Focus Graphite and China Sun 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 Focus Graphite and China Sun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Graphite and China Sun Grp, you can compare the effects of market volatilities on Focus Graphite and China Sun 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 Focus Graphite with a short position of China Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Graphite and China Sun.
Diversification Opportunities for Focus Graphite and China Sun
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Focus and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Focus Graphite and China Sun Grp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Sun Grp and Focus Graphite 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 Focus Graphite are associated (or correlated) with China Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Sun Grp has no effect on the direction of Focus Graphite i.e., Focus Graphite and China Sun go up and down completely randomly.
Pair Corralation between Focus Graphite and China Sun
If you would invest 6.00 in Focus Graphite on September 1, 2024 and sell it today you would lose (0.34) from holding Focus Graphite or give up 5.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Focus Graphite vs. China Sun Grp
Performance |
| Timeline |
| Focus Graphite |
| China Sun Grp |
Focus Graphite and China Sun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Graphite and China Sun
The main advantage of trading using opposite Focus Graphite and China Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Graphite position performs unexpectedly, China Sun 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 Sun will offset losses from the drop in China Sun's long position.| Focus Graphite vs. Northern Graphite | Focus Graphite vs. Syrah Resources Limited | Focus Graphite vs. Altura Mining Limited | Focus Graphite vs. Vulcan Minerals |
| China Sun vs. South32 Limited | China Sun vs. NioCorp Developments Ltd | China Sun vs. HUMANA INC | China Sun vs. SCOR PK |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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