Correlation Between Fukuyama Transporting and PPHE HOTEL

Can any of the company-specific risk be diversified away by investing in both Fukuyama Transporting and PPHE HOTEL 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 Fukuyama Transporting and PPHE HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fukuyama Transporting Co and PPHE HOTEL GROUP, you can compare the effects of market volatilities on Fukuyama Transporting and PPHE HOTEL 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 Fukuyama Transporting with a short position of PPHE HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fukuyama Transporting and PPHE HOTEL.

Diversification Opportunities for Fukuyama Transporting and PPHE HOTEL

-0.86

Correlation Coefficient

Fukuyama Transporting  PPHE HOTEL

Pay attention - limited upside

The 3 months correlation between Fukuyama and PPHE is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Fukuyama Transporting Co and PPHE HOTEL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPHE HOTEL GROUP and Fukuyama Transporting 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 Fukuyama Transporting Co are associated (or correlated) with PPHE HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPHE HOTEL GROUP has no effect on the direction of Fukuyama Transporting i.e., Fukuyama Transporting and PPHE HOTEL go up and down completely randomly.

Pair Corralation between Fukuyama Transporting and PPHE HOTEL

Assuming the 90 days horizon Fukuyama Transporting Co is expected to under-perform the PPHE HOTEL. But the stock apears to be less risky and, when comparing its historical volatility, Fukuyama Transporting Co is 1.04 times less risky than PPHE HOTEL. The stock trades about -0.09 of its potential returns per unit of risk. The PPHE HOTEL GROUP is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  1,540  in PPHE HOTEL GROUP on April 25, 2025 and sell it today you would earn a total of  260.00  from holding PPHE HOTEL GROUP or generate 16.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Fukuyama Transporting Co  vs.  PPHE HOTEL GROUP

Fukuyama Transporting

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fukuyama Transporting Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

PPHE HOTEL GROUP

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PPHE HOTEL GROUP are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, PPHE HOTEL exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fukuyama Transporting and PPHE HOTEL

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

The idea behind Fukuyama Transporting Co and PPHE HOTEL GROUP 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.