Correlation Between Fusheng Precision and O TA
Can any of the company-specific risk be diversified away by investing in both Fusheng Precision and O TA 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 Fusheng Precision and O TA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fusheng Precision Co and O TA Precision Industry, you can compare the effects of market volatilities on Fusheng Precision and O TA 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 Fusheng Precision with a short position of O TA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fusheng Precision and O TA.
Diversification Opportunities for Fusheng Precision and O TA
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fusheng and 8924 is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Fusheng Precision Co and O TA Precision Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on O TA Precision and Fusheng Precision 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 Fusheng Precision Co are associated (or correlated) with O TA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of O TA Precision has no effect on the direction of Fusheng Precision i.e., Fusheng Precision and O TA go up and down completely randomly.
Pair Corralation between Fusheng Precision and O TA
Assuming the 90 days trading horizon Fusheng Precision Co is expected to generate 1.98 times more return on investment than O TA. However, Fusheng Precision is 1.98 times more volatile than O TA Precision Industry. It trades about 0.04 of its potential returns per unit of risk. O TA Precision Industry is currently generating about -0.1 per unit of risk. If you would invest 28,350 in Fusheng Precision Co on September 19, 2024 and sell it today you would earn a total of 2,400 from holding Fusheng Precision Co or generate 8.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 99.21% |
Values | Daily Returns |
Fusheng Precision Co vs. O TA Precision Industry
Performance |
Timeline |
Fusheng Precision |
O TA Precision |
Fusheng Precision and O TA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fusheng Precision and O TA
The main advantage of trading using opposite Fusheng Precision and O TA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fusheng Precision position performs unexpectedly, O TA 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 O TA will offset losses from the drop in O TA's long position.Fusheng Precision vs. Feng Tay Enterprises | Fusheng Precision vs. Pou Chen Corp | Fusheng Precision vs. Taiwan Paiho | Fusheng Precision vs. Ruentex Development Co |
O TA vs. Feng Tay Enterprises | O TA vs. Pou Chen Corp | O TA vs. Taiwan Paiho | O TA vs. Ruentex Development Co |
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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