Correlation Between Yuexiu Transport and Fidelis Insurance
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Fidelis Insurance 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 Yuexiu Transport and Fidelis Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuexiu Transport Infrastructure and Fidelis Insurance Holdings, you can compare the effects of market volatilities on Yuexiu Transport and Fidelis Insurance 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 Yuexiu Transport with a short position of Fidelis Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Fidelis Insurance.
Diversification Opportunities for Yuexiu Transport and Fidelis Insurance
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yuexiu and Fidelis is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Fidelis Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelis Insurance and Yuexiu Transport 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 Yuexiu Transport Infrastructure are associated (or correlated) with Fidelis Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelis Insurance has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Fidelis Insurance go up and down completely randomly.
Pair Corralation between Yuexiu Transport and Fidelis Insurance
Assuming the 90 days horizon Yuexiu Transport Infrastructure is expected to generate 1.62 times more return on investment than Fidelis Insurance. However, Yuexiu Transport is 1.62 times more volatile than Fidelis Insurance Holdings. It trades about 0.13 of its potential returns per unit of risk. Fidelis Insurance Holdings is currently generating about 0.1 per unit of risk. If you would invest 45.00 in Yuexiu Transport Infrastructure on September 12, 2024 and sell it today you would earn a total of 13.00 from holding Yuexiu Transport Infrastructure or generate 28.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Yuexiu Transport Infrastructur vs. Fidelis Insurance Holdings
Performance |
| Timeline |
| Yuexiu Transport Inf |
| Fidelis Insurance |
Yuexiu Transport and Fidelis Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuexiu Transport and Fidelis Insurance
The main advantage of trading using opposite Yuexiu Transport and Fidelis Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport position performs unexpectedly, Fidelis Insurance 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 Fidelis Insurance will offset losses from the drop in Fidelis Insurance's long position.| Yuexiu Transport vs. Recursion Pharmaceuticals | Yuexiu Transport vs. SoFi Technologies | Yuexiu Transport vs. PayPal Holdings | Yuexiu Transport vs. Intuitive Machines |
| Fidelis Insurance vs. IPG Photonics | Fidelis Insurance vs. Consol Energy | Fidelis Insurance vs. Asbury Automotive Group | Fidelis Insurance vs. Summit Materials |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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