Correlation Between Fuwei Films and O I
Can any of the company-specific risk be diversified away by investing in both Fuwei Films and O I 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 Fuwei Films and O I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fuwei Films Holdings and O I Glass, you can compare the effects of market volatilities on Fuwei Films and O I 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 Fuwei Films with a short position of O I. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fuwei Films and O I.
Diversification Opportunities for Fuwei Films and O I
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fuwei and O I is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Fuwei Films Holdings and O I Glass in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on O I Glass and Fuwei Films 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 Fuwei Films Holdings are associated (or correlated) with O I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of O I Glass has no effect on the direction of Fuwei Films i.e., Fuwei Films and O I go up and down completely randomly.
Pair Corralation between Fuwei Films and O I
If you would invest 1,513 in O I Glass on January 17, 2024 and sell it today you would earn a total of 18.00 from holding O I Glass or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Fuwei Films Holdings vs. O I Glass
Performance |
| Timeline |
| Fuwei Films Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| O I Glass |
Fuwei Films and O I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fuwei Films and O I
The main advantage of trading using opposite Fuwei Films and O I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fuwei Films position performs unexpectedly, O I 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 I will offset losses from the drop in O I's long position.| Fuwei Films vs. Fresh Grapes LLC | Fuwei Films vs. National Beverage Corp | Fuwei Films vs. Keurig Dr Pepper | Fuwei Films vs. Natural Alternatives International |
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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