Correlation Between FANDIFI TECHNOLOGY and INDCOMMBK CHINA
Can any of the company-specific risk be diversified away by investing in both FANDIFI TECHNOLOGY and INDCOMMBK CHINA 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 INDCOMMBK CHINA 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 INDCOMMBK CHINA ADR20, you can compare the effects of market volatilities on FANDIFI TECHNOLOGY and INDCOMMBK CHINA 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 INDCOMMBK CHINA. Check out your portfolio center. Please also check ongoing floating volatility patterns of FANDIFI TECHNOLOGY and INDCOMMBK CHINA.
Diversification Opportunities for FANDIFI TECHNOLOGY and INDCOMMBK CHINA
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FANDIFI and INDCOMMBK is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FANDIFI TECHNOLOGY P and INDCOMMBK CHINA ADR20 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INDCOMMBK CHINA ADR20 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 INDCOMMBK CHINA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INDCOMMBK CHINA ADR20 has no effect on the direction of FANDIFI TECHNOLOGY i.e., FANDIFI TECHNOLOGY and INDCOMMBK CHINA go up and down completely randomly.
Pair Corralation between FANDIFI TECHNOLOGY and INDCOMMBK CHINA
Assuming the 90 days horizon FANDIFI TECHNOLOGY P is expected to generate 10.4 times more return on investment than INDCOMMBK CHINA. However, FANDIFI TECHNOLOGY is 10.4 times more volatile than INDCOMMBK CHINA ADR20. It trades about 0.04 of its potential returns per unit of risk. INDCOMMBK CHINA ADR20 is currently generating about 0.08 per unit of risk. If you would invest 0.50 in FANDIFI TECHNOLOGY P on September 15, 2024 and sell it today you would lose (0.45) from holding FANDIFI TECHNOLOGY P or give up 90.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.64% |
| Values | Daily Returns |
FANDIFI TECHNOLOGY P vs. INDCOMMBK CHINA ADR20
Performance |
| Timeline |
| FANDIFI TECHNOLOGY |
| INDCOMMBK CHINA ADR20 |
FANDIFI TECHNOLOGY and INDCOMMBK CHINA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FANDIFI TECHNOLOGY and INDCOMMBK CHINA
The main advantage of trading using opposite FANDIFI TECHNOLOGY and INDCOMMBK CHINA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FANDIFI TECHNOLOGY position performs unexpectedly, INDCOMMBK CHINA 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 INDCOMMBK CHINA will offset losses from the drop in INDCOMMBK CHINA's long position.| FANDIFI TECHNOLOGY vs. Superior Plus Corp | FANDIFI TECHNOLOGY vs. SIVERS SEMICONDUCTORS AB | FANDIFI TECHNOLOGY vs. Norsk Hydro ASA | FANDIFI TECHNOLOGY vs. Reliance Steel Aluminum |
| INDCOMMBK CHINA vs. Natural Health Trends | INDCOMMBK CHINA vs. Sunny Optical Technology | INDCOMMBK CHINA vs. FANDIFI TECHNOLOGY P | INDCOMMBK CHINA vs. ATRYS HEALTH SA |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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