Correlation Between Yuan High and Materials Analysis
Can any of the company-specific risk be diversified away by investing in both Yuan High and Materials Analysis 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 Yuan High and Materials Analysis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuan High Tech Development and Materials Analysis Technology, you can compare the effects of market volatilities on Yuan High and Materials Analysis 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 Yuan High with a short position of Materials Analysis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan High and Materials Analysis.
Diversification Opportunities for Yuan High and Materials Analysis
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yuan and Materials is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Yuan High Tech Development and Materials Analysis Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materials Analysis and Yuan High 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 Yuan High Tech Development are associated (or correlated) with Materials Analysis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materials Analysis has no effect on the direction of Yuan High i.e., Yuan High and Materials Analysis go up and down completely randomly.
Pair Corralation between Yuan High and Materials Analysis
Assuming the 90 days trading horizon Yuan High Tech Development is expected to generate 1.36 times more return on investment than Materials Analysis. However, Yuan High is 1.36 times more volatile than Materials Analysis Technology. It trades about 0.07 of its potential returns per unit of risk. Materials Analysis Technology is currently generating about 0.06 per unit of risk. If you would invest 6,918 in Yuan High Tech Development on September 24, 2024 and sell it today you would earn a total of 10,382 from holding Yuan High Tech Development or generate 150.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Yuan High Tech Development vs. Materials Analysis Technology
Performance |
Timeline |
Yuan High Tech |
Materials Analysis |
Yuan High and Materials Analysis Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yuan High and Materials Analysis
The main advantage of trading using opposite Yuan High and Materials Analysis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuan High position performs unexpectedly, Materials Analysis 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 Materials Analysis will offset losses from the drop in Materials Analysis' long position.Yuan High vs. Li Kang Biomedical | Yuan High vs. Trade Van Information Services | Yuan High vs. Tait Marketing Distribution | Yuan High vs. Tradetool Auto Co |
Materials Analysis vs. Integrated Service Technology | Materials Analysis vs. ASE Industrial Holding | Materials Analysis vs. Gudeng Precision Industrial | Materials Analysis vs. eMemory Technology |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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