Correlation Between Transport International and FUYO GENERAL
Can any of the company-specific risk be diversified away by investing in both Transport International 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 Transport International and FUYO GENERAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transport International Holdings and FUYO GENERAL LEASE, you can compare the effects of market volatilities on Transport International 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 Transport International with a short position of FUYO GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transport International and FUYO GENERAL.
Diversification Opportunities for Transport International and FUYO GENERAL
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Transport and FUYO is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Transport International Holdin 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 Transport International 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 Transport International Holdings 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 Transport International i.e., Transport International and FUYO GENERAL go up and down completely randomly.
Pair Corralation between Transport International and FUYO GENERAL
Assuming the 90 days horizon Transport International Holdings is expected to generate 3.71 times more return on investment than FUYO GENERAL. However, Transport International is 3.71 times more volatile than FUYO GENERAL LEASE. It trades about 0.07 of its potential returns per unit of risk. FUYO GENERAL LEASE is currently generating about -0.06 per unit of risk. If you would invest 55.00 in Transport International Holdings on August 27, 2024 and sell it today you would earn a total of 40.00 from holding Transport International Holdings or generate 72.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transport International Holdin vs. FUYO GENERAL LEASE
Performance |
| Timeline |
| Transport International |
| FUYO GENERAL LEASE |
Transport International and FUYO GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transport International and FUYO GENERAL
The main advantage of trading using opposite Transport International and FUYO GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transport International 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.| Transport International vs. FUYO GENERAL LEASE | Transport International vs. Global Ship Lease | Transport International vs. LION ONE METALS | Transport International vs. Evolution Mining Limited |
| FUYO GENERAL vs. Compugroup Medical SE | FUYO GENERAL vs. MeVis Medical Solutions | FUYO GENERAL vs. Advanced Medical Solutions | FUYO GENERAL vs. Japan Medical Dynamic |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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