Correlation Between Fuquan Capital and Federal Signal
Can any of the company-specific risk be diversified away by investing in both Fuquan Capital and Federal Signal 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 Fuquan Capital and Federal Signal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fuquan Capital Management and Federal Signal, you can compare the effects of market volatilities on Fuquan Capital and Federal Signal 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 Fuquan Capital with a short position of Federal Signal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fuquan Capital and Federal Signal.
Diversification Opportunities for Fuquan Capital and Federal Signal
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fuquan and Federal is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fuquan Capital Management and Federal Signal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Signal and Fuquan Capital 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 Fuquan Capital Management are associated (or correlated) with Federal Signal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Signal has no effect on the direction of Fuquan Capital i.e., Fuquan Capital and Federal Signal go up and down completely randomly.
Pair Corralation between Fuquan Capital and Federal Signal
If you would invest 8,467 in Federal Signal on August 31, 2024 and sell it today you would earn a total of 1,321 from holding Federal Signal or generate 15.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fuquan Capital Management vs. Federal Signal
Performance |
| Timeline |
| Fuquan Capital Management |
| Federal Signal |
Fuquan Capital and Federal Signal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fuquan Capital and Federal Signal
The main advantage of trading using opposite Fuquan Capital and Federal Signal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fuquan Capital position performs unexpectedly, Federal Signal 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 Federal Signal will offset losses from the drop in Federal Signal's long position.| Fuquan Capital vs. Century Aluminum | Fuquan Capital vs. Ziff Davis | Fuquan Capital vs. Summit Environmental | Fuquan Capital vs. Porvair plc |
| Federal Signal vs. Energy Recovery | Federal Signal vs. CECO Environmental Corp | Federal Signal vs. 374Water Common Stock | Federal Signal vs. CO2 Solutions |
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 CEOs Directory module to screen CEOs from public companies around the world.
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