Correlation Between Xiandai Investment and FSPG Hi
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By analyzing existing cross correlation between Xiandai Investment Co and FSPG Hi Tech Co, you can compare the effects of market volatilities on Xiandai Investment and FSPG Hi 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 Xiandai Investment with a short position of FSPG Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiandai Investment and FSPG Hi.
Diversification Opportunities for Xiandai Investment and FSPG Hi
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiandai and FSPG is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Xiandai Investment Co and FSPG Hi Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FSPG Hi Tech and Xiandai Investment 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 Xiandai Investment Co are associated (or correlated) with FSPG Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FSPG Hi Tech has no effect on the direction of Xiandai Investment i.e., Xiandai Investment and FSPG Hi go up and down completely randomly.
Pair Corralation between Xiandai Investment and FSPG Hi
Assuming the 90 days trading horizon Xiandai Investment is expected to generate 1.96 times less return on investment than FSPG Hi. But when comparing it to its historical volatility, Xiandai Investment Co is 1.83 times less risky than FSPG Hi. It trades about 0.03 of its potential returns per unit of risk. FSPG Hi Tech Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 481.00 in FSPG Hi Tech Co on October 6, 2024 and sell it today you would earn a total of 79.00 from holding FSPG Hi Tech Co or generate 16.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 99.58% |
Values | Daily Returns |
Xiandai Investment Co vs. FSPG Hi Tech Co
Performance |
Timeline |
Xiandai Investment |
FSPG Hi Tech |
Xiandai Investment and FSPG Hi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xiandai Investment and FSPG Hi
The main advantage of trading using opposite Xiandai Investment and FSPG Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiandai Investment position performs unexpectedly, FSPG Hi 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 FSPG Hi will offset losses from the drop in FSPG Hi's long position.Xiandai Investment vs. Kunshan Guoli Electronic | Xiandai Investment vs. Pengxin International Mining | Xiandai Investment vs. Shengda Mining Co | Xiandai Investment vs. Success Electronics |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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