Correlation Between FANDIFI TECHNOLOGY and Chongqing Machinery
Can any of the company-specific risk be diversified away by investing in both FANDIFI TECHNOLOGY and Chongqing Machinery 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 FANDIFI TECHNOLOGY and Chongqing Machinery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FANDIFI TECHNOLOGY P and Chongqing Machinery Electric, you can compare the effects of market volatilities on FANDIFI TECHNOLOGY and Chongqing Machinery 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 FANDIFI TECHNOLOGY with a short position of Chongqing Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of FANDIFI TECHNOLOGY and Chongqing Machinery.
Diversification Opportunities for FANDIFI TECHNOLOGY and Chongqing Machinery
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FANDIFI and Chongqing is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FANDIFI TECHNOLOGY P and Chongqing Machinery Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Machinery and FANDIFI TECHNOLOGY 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 FANDIFI TECHNOLOGY P are associated (or correlated) with Chongqing Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Machinery has no effect on the direction of FANDIFI TECHNOLOGY i.e., FANDIFI TECHNOLOGY and Chongqing Machinery go up and down completely randomly.
Pair Corralation between FANDIFI TECHNOLOGY and Chongqing Machinery
If you would invest 7.55 in Chongqing Machinery Electric on October 12, 2024 and sell it today you would earn a total of 0.60 from holding Chongqing Machinery Electric or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 88.89% |
| Values | Daily Returns |
FANDIFI TECHNOLOGY P vs. Chongqing Machinery Electric
Performance |
| Timeline |
| FANDIFI TECHNOLOGY |
| Chongqing Machinery |
FANDIFI TECHNOLOGY and Chongqing Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FANDIFI TECHNOLOGY and Chongqing Machinery
The main advantage of trading using opposite FANDIFI TECHNOLOGY and Chongqing Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FANDIFI TECHNOLOGY position performs unexpectedly, Chongqing Machinery 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 Chongqing Machinery will offset losses from the drop in Chongqing Machinery's long position.| FANDIFI TECHNOLOGY vs. Eidesvik Offshore ASA | FANDIFI TECHNOLOGY vs. TIANDE CHEMICAL | FANDIFI TECHNOLOGY vs. EAGLE MATERIALS | FANDIFI TECHNOLOGY vs. Heidelberg Materials AG |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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