Correlation Between New England and Fangdd Network
Can any of the company-specific risk be diversified away by investing in both New England and Fangdd Network 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 New England and Fangdd Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New England Realty and Fangdd Network Group, you can compare the effects of market volatilities on New England and Fangdd Network 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 New England with a short position of Fangdd Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of New England and Fangdd Network.
Diversification Opportunities for New England and Fangdd Network
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between New and Fangdd is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding New England Realty and Fangdd Network Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fangdd Network Group and New England 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 New England Realty are associated (or correlated) with Fangdd Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fangdd Network Group has no effect on the direction of New England i.e., New England and Fangdd Network go up and down completely randomly.
Pair Corralation between New England and Fangdd Network
Considering the 90-day investment horizon New England Realty is expected to generate 6.37 times more return on investment than Fangdd Network. However, New England is 6.37 times more volatile than Fangdd Network Group. It trades about 0.11 of its potential returns per unit of risk. Fangdd Network Group is currently generating about 0.06 per unit of risk. If you would invest 7,119 in New England Realty on September 2, 2024 and sell it today you would earn a total of 1,128 from holding New England Realty or generate 15.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 50.79% |
| Values | Daily Returns |
New England Realty vs. Fangdd Network Group
Performance |
| Timeline |
| New England Realty |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Fangdd Network Group |
New England and Fangdd Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New England and Fangdd Network
The main advantage of trading using opposite New England and Fangdd Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New England position performs unexpectedly, Fangdd Network 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 Fangdd Network will offset losses from the drop in Fangdd Network's long position.| New England vs. The Intergroup | New England vs. Transcontinental Realty Investors | New England vs. American Realty Investors | New England vs. Gyrodyne Company of |
| Fangdd Network vs. MDJM | Fangdd Network vs. Southcorp Capital | Fangdd Network vs. Frp Holdings Ord | Fangdd Network vs. Ucommune International |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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