Correlation Between Fujian Forecam and Tianjin Pengling
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By analyzing existing cross correlation between Fujian Forecam Optics and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Fujian Forecam and Tianjin Pengling 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 Fujian Forecam with a short position of Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Forecam and Tianjin Pengling.
Diversification Opportunities for Fujian Forecam and Tianjin Pengling
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fujian and Tianjin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Forecam Optics and Tianjin Pengling Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Pengling Rubber and Fujian Forecam 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 Fujian Forecam Optics are associated (or correlated) with Tianjin Pengling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Pengling Rubber has no effect on the direction of Fujian Forecam i.e., Fujian Forecam and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Fujian Forecam and Tianjin Pengling
Assuming the 90 days trading horizon Fujian Forecam Optics is expected to generate 1.93 times more return on investment than Tianjin Pengling. However, Fujian Forecam is 1.93 times more volatile than Tianjin Pengling Rubber. It trades about 0.22 of its potential returns per unit of risk. Tianjin Pengling Rubber is currently generating about 0.14 per unit of risk. If you would invest 1,429 in Fujian Forecam Optics on September 5, 2024 and sell it today you would earn a total of 1,756 from holding Fujian Forecam Optics or generate 122.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Fujian Forecam Optics vs. Tianjin Pengling Rubber
Performance |
Timeline |
Fujian Forecam Optics |
Tianjin Pengling Rubber |
Fujian Forecam and Tianjin Pengling Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fujian Forecam and Tianjin Pengling
The main advantage of trading using opposite Fujian Forecam and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Forecam position performs unexpectedly, Tianjin Pengling 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 Tianjin Pengling will offset losses from the drop in Tianjin Pengling's long position.Fujian Forecam vs. BeiGene | Fujian Forecam vs. Kweichow Moutai Co | Fujian Forecam vs. Beijing Roborock Technology | Fujian Forecam vs. G bits Network Technology |
Tianjin Pengling vs. CICT Mobile Communication | Tianjin Pengling vs. Sinomach Automobile Co | Tianjin Pengling vs. Tongyu Communication | Tianjin Pengling vs. Dawning Information Industry |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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