Correlation Between China BlueChemical and FUYO GENERAL
Can any of the company-specific risk be diversified away by investing in both China BlueChemical and FUYO GENERAL 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 China BlueChemical and FUYO GENERAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China BlueChemical and FUYO GENERAL LEASE, you can compare the effects of market volatilities on China BlueChemical and FUYO GENERAL 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 China BlueChemical with a short position of FUYO GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of China BlueChemical and FUYO GENERAL.
Diversification Opportunities for China BlueChemical and FUYO GENERAL
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and FUYO is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding China BlueChemical and FUYO GENERAL LEASE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUYO GENERAL LEASE and China BlueChemical 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 China BlueChemical are associated (or correlated) with FUYO GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUYO GENERAL LEASE has no effect on the direction of China BlueChemical i.e., China BlueChemical and FUYO GENERAL go up and down completely randomly.
Pair Corralation between China BlueChemical and FUYO GENERAL
Assuming the 90 days horizon China BlueChemical is expected to generate 7.13 times less return on investment than FUYO GENERAL. In addition to that, China BlueChemical is 2.58 times more volatile than FUYO GENERAL LEASE. It trades about 0.02 of its total potential returns per unit of risk. FUYO GENERAL LEASE is currently generating about 0.32 per unit of volatility. If you would invest 6,500 in FUYO GENERAL LEASE on September 5, 2024 and sell it today you would earn a total of 700.00 from holding FUYO GENERAL LEASE or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
China BlueChemical vs. FUYO GENERAL LEASE
Performance |
| Timeline |
| China BlueChemical |
| FUYO GENERAL LEASE |
China BlueChemical and FUYO GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China BlueChemical and FUYO GENERAL
The main advantage of trading using opposite China BlueChemical and FUYO GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China BlueChemical position performs unexpectedly, FUYO GENERAL 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 FUYO GENERAL will offset losses from the drop in FUYO GENERAL's long position.| China BlueChemical vs. FUYO GENERAL LEASE | China BlueChemical vs. Global Ship Lease | China BlueChemical vs. PLAYSTUDIOS A DL 0001 | China BlueChemical vs. Lendlease Group |
| FUYO GENERAL vs. Texas Roadhouse | FUYO GENERAL vs. Take Two Interactive Software | FUYO GENERAL vs. PSI Software AG | FUYO GENERAL vs. Magic Software Enterprises |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |