Correlation Between Yihai International and Fair Isaac
Can any of the company-specific risk be diversified away by investing in both Yihai International and Fair Isaac 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 Yihai International and Fair Isaac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yihai International Holding and Fair Isaac Corp, you can compare the effects of market volatilities on Yihai International and Fair Isaac 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 Yihai International with a short position of Fair Isaac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yihai International and Fair Isaac.
Diversification Opportunities for Yihai International and Fair Isaac
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Yihai and Fair is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Yihai International Holding and Fair Isaac Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fair Isaac Corp and Yihai 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 Yihai International Holding are associated (or correlated) with Fair Isaac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fair Isaac Corp has no effect on the direction of Yihai International i.e., Yihai International and Fair Isaac go up and down completely randomly.
Pair Corralation between Yihai International and Fair Isaac
Assuming the 90 days horizon Yihai International Holding is expected to generate 1.36 times more return on investment than Fair Isaac. However, Yihai International is 1.36 times more volatile than Fair Isaac Corp. It trades about 0.32 of its potential returns per unit of risk. Fair Isaac Corp is currently generating about -0.11 per unit of risk. If you would invest 163.00 in Yihai International Holding on September 15, 2024 and sell it today you would earn a total of 33.00 from holding Yihai International Holding or generate 20.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yihai International Holding vs. Fair Isaac Corp
Performance |
| Timeline |
| Yihai International |
| Fair Isaac Corp |
Yihai International and Fair Isaac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yihai International and Fair Isaac
The main advantage of trading using opposite Yihai International and Fair Isaac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yihai International position performs unexpectedly, Fair Isaac 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 Fair Isaac will offset losses from the drop in Fair Isaac's long position.| Yihai International vs. Fair Isaac Corp | Yihai International vs. UNITED UTILITIES GR | Yihai International vs. SOGECLAIR SA INH | Yihai International vs. HF SINCLAIR P |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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