Correlation Between Foxconn Technology and Gold Rain
Can any of the company-specific risk be diversified away by investing in both Foxconn Technology and Gold Rain 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 Foxconn Technology and Gold Rain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foxconn Technology Co and Gold Rain Enterprises, you can compare the effects of market volatilities on Foxconn Technology and Gold Rain 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 Foxconn Technology with a short position of Gold Rain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foxconn Technology and Gold Rain.
Diversification Opportunities for Foxconn Technology and Gold Rain
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Foxconn and Gold is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Foxconn Technology Co and Gold Rain Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Rain Enterprises and Foxconn Technology 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 Foxconn Technology Co are associated (or correlated) with Gold Rain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Rain Enterprises has no effect on the direction of Foxconn Technology i.e., Foxconn Technology and Gold Rain go up and down completely randomly.
Pair Corralation between Foxconn Technology and Gold Rain
Assuming the 90 days trading horizon Foxconn Technology Co is expected to generate 1.09 times more return on investment than Gold Rain. However, Foxconn Technology is 1.09 times more volatile than Gold Rain Enterprises. It trades about 0.05 of its potential returns per unit of risk. Gold Rain Enterprises is currently generating about -0.03 per unit of risk. If you would invest 6,910 in Foxconn Technology Co on September 25, 2024 and sell it today you would earn a total of 830.00 from holding Foxconn Technology Co or generate 12.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Foxconn Technology Co vs. Gold Rain Enterprises
Performance |
Timeline |
Foxconn Technology |
Gold Rain Enterprises |
Foxconn Technology and Gold Rain Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Foxconn Technology and Gold Rain
The main advantage of trading using opposite Foxconn Technology and Gold Rain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foxconn Technology position performs unexpectedly, Gold Rain 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 Gold Rain will offset losses from the drop in Gold Rain's long position.Foxconn Technology vs. Century Wind Power | Foxconn Technology vs. Green World Fintech | Foxconn Technology vs. Ingentec | Foxconn Technology vs. Chaheng Precision Co |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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