Correlation Between FUYO GENERAL and Airbus SE
Can any of the company-specific risk be diversified away by investing in both FUYO GENERAL and Airbus SE 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 FUYO GENERAL and Airbus SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FUYO GENERAL LEASE and Airbus SE, you can compare the effects of market volatilities on FUYO GENERAL and Airbus SE 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 FUYO GENERAL with a short position of Airbus SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of FUYO GENERAL and Airbus SE.
Diversification Opportunities for FUYO GENERAL and Airbus SE
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FUYO and Airbus is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding FUYO GENERAL LEASE and Airbus SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airbus SE and FUYO GENERAL 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 FUYO GENERAL LEASE are associated (or correlated) with Airbus SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airbus SE has no effect on the direction of FUYO GENERAL i.e., FUYO GENERAL and Airbus SE go up and down completely randomly.
Pair Corralation between FUYO GENERAL and Airbus SE
Assuming the 90 days horizon FUYO GENERAL LEASE is expected to under-perform the Airbus SE. In addition to that, FUYO GENERAL is 1.42 times more volatile than Airbus SE. It trades about -0.03 of its total potential returns per unit of risk. Airbus SE is currently generating about 0.0 per unit of volatility. If you would invest 3,920 in Airbus SE on October 14, 2024 and sell it today you would earn a total of 0.00 from holding Airbus SE or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FUYO GENERAL LEASE vs. Airbus SE
Performance |
| Timeline |
| FUYO GENERAL LEASE |
| Airbus SE |
FUYO GENERAL and Airbus SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FUYO GENERAL and Airbus SE
The main advantage of trading using opposite FUYO GENERAL and Airbus SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FUYO GENERAL position performs unexpectedly, Airbus SE 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 Airbus SE will offset losses from the drop in Airbus SE's long position.| FUYO GENERAL vs. TRI CHEMICAL LABORATINC | FUYO GENERAL vs. New Residential Investment | FUYO GENERAL vs. Japan Asia Investment | FUYO GENERAL vs. Keck Seng Investments |
| Airbus SE vs. FUYO GENERAL LEASE | Airbus SE vs. Goosehead Insurance | Airbus SE vs. REVO INSURANCE SPA | Airbus SE vs. Japan Post Insurance |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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