Correlation Between FUYO GENERAL and SIKA AG
Can any of the company-specific risk be diversified away by investing in both FUYO GENERAL and SIKA AG 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 FUYO GENERAL and SIKA AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FUYO GENERAL LEASE and SIKA AG UNSPADR, you can compare the effects of market volatilities on FUYO GENERAL and SIKA AG 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 FUYO GENERAL with a short position of SIKA AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of FUYO GENERAL and SIKA AG.
Diversification Opportunities for FUYO GENERAL and SIKA AG
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between FUYO and SIKA is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding FUYO GENERAL LEASE and SIKA AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIKA AG UNSPADR and FUYO GENERAL 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 FUYO GENERAL LEASE are associated (or correlated) with SIKA AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIKA AG UNSPADR has no effect on the direction of FUYO GENERAL i.e., FUYO GENERAL and SIKA AG go up and down completely randomly.
Pair Corralation between FUYO GENERAL and SIKA AG
Assuming the 90 days horizon FUYO GENERAL LEASE is expected to generate 0.45 times more return on investment than SIKA AG. However, FUYO GENERAL LEASE is 2.24 times less risky than SIKA AG. It trades about 0.04 of its potential returns per unit of risk. SIKA AG UNSPADR is currently generating about 0.01 per unit of risk. If you would invest 7,000 in FUYO GENERAL LEASE on December 2, 2024 and sell it today you would earn a total of 200.00 from holding FUYO GENERAL LEASE or generate 2.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
FUYO GENERAL LEASE vs. SIKA AG UNSPADR
Performance |
Timeline |
FUYO GENERAL LEASE |
SIKA AG UNSPADR |
FUYO GENERAL and SIKA AG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FUYO GENERAL and SIKA AG
The main advantage of trading using opposite FUYO GENERAL and SIKA AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FUYO GENERAL position performs unexpectedly, SIKA AG 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 SIKA AG will offset losses from the drop in SIKA AG's long position.FUYO GENERAL vs. Citic Telecom International | FUYO GENERAL vs. VARIOUS EATERIES LS | FUYO GENERAL vs. Singapore Telecommunications Limited | FUYO GENERAL vs. GOODYEAR T RUBBER |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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