Correlation Between Formidable ETF and Rayliant Quantamental

Can any of the company-specific risk be diversified away by investing in both Formidable ETF and Rayliant Quantamental 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 Formidable ETF and Rayliant Quantamental into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Formidable ETF and Rayliant Quantamental China, you can compare the effects of market volatilities on Formidable ETF and Rayliant Quantamental 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 Formidable ETF with a short position of Rayliant Quantamental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Formidable ETF and Rayliant Quantamental.

Diversification Opportunities for Formidable ETF and Rayliant Quantamental

0.06

Correlation Coefficient

Formidable ETF  Rayliant Quantamental

Significant diversification

The 3 months correlation between Formidable and Rayliant is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Formidable ETF and Rayliant Quantamental China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rayliant Quantamental and Formidable ETF 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 Formidable ETF are associated (or correlated) with Rayliant Quantamental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rayliant Quantamental has no effect on the direction of Formidable ETF i.e., Formidable ETF and Rayliant Quantamental go up and down completely randomly.

Pair Corralation between Formidable ETF and Rayliant Quantamental

Given the investment horizon of 90 days Formidable ETF is expected to generate 1.41 times more return on investment than Rayliant Quantamental. However, Formidable ETF is 1.41 times more volatile than Rayliant Quantamental China. It trades about 0.08 of its potential returns per unit of risk. Rayliant Quantamental China is currently generating about 0.04 per unit of risk. If you would invest  2,383  in Formidable ETF on September 14, 2025 and sell it today you would earn a total of  157.00  from holding Formidable ETF or generate 6.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	93.75%
Values	Daily Returns

Formidable ETF  vs.  Rayliant Quantamental China

Formidable ETF

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Formidable ETF are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, Formidable ETF may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Rayliant Quantamental

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Rayliant Quantamental China are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Rayliant Quantamental is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Formidable ETF and Rayliant Quantamental

The main advantage of trading using opposite Formidable ETF and Rayliant Quantamental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Formidable ETF position performs unexpectedly, Rayliant Quantamental 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 Rayliant Quantamental will offset losses from the drop in Rayliant Quantamental's long position.

The idea behind Formidable ETF and Rayliant Quantamental China pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.