Correlation Between Yuexiu Transport and Lamar Advertising
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Lamar Advertising 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 Yuexiu Transport and Lamar Advertising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuexiu Transport Infrastructure and Lamar Advertising, you can compare the effects of market volatilities on Yuexiu Transport and Lamar Advertising 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 Yuexiu Transport with a short position of Lamar Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Lamar Advertising.
Diversification Opportunities for Yuexiu Transport and Lamar Advertising
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Yuexiu and Lamar is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Lamar Advertising in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lamar Advertising and Yuexiu Transport 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 Yuexiu Transport Infrastructure are associated (or correlated) with Lamar Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lamar Advertising has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Lamar Advertising go up and down completely randomly.
Pair Corralation between Yuexiu Transport and Lamar Advertising
Assuming the 90 days horizon Yuexiu Transport Infrastructure is expected to generate 2.96 times more return on investment than Lamar Advertising. However, Yuexiu Transport is 2.96 times more volatile than Lamar Advertising. It trades about 0.07 of its potential returns per unit of risk. Lamar Advertising is currently generating about 0.06 per unit of risk. If you would invest 35.00 in Yuexiu Transport Infrastructure on September 25, 2024 and sell it today you would earn a total of 10.00 from holding Yuexiu Transport Infrastructure or generate 28.57% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Yuexiu Transport Infrastructur vs. Lamar Advertising
Performance |
Timeline |
Yuexiu Transport Inf |
Lamar Advertising |
Yuexiu Transport and Lamar Advertising Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yuexiu Transport and Lamar Advertising
The main advantage of trading using opposite Yuexiu Transport and Lamar Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport position performs unexpectedly, Lamar Advertising 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 Lamar Advertising will offset losses from the drop in Lamar Advertising's long position.Yuexiu Transport vs. Transurban Group | Yuexiu Transport vs. Jiangsu Expressway | Yuexiu Transport vs. Zhejiang Expressway Co | Yuexiu Transport vs. Arcosa Inc |
Lamar Advertising vs. Fukuyama Transporting Co | Lamar Advertising vs. Gaztransport Technigaz SA | Lamar Advertising vs. Eidesvik Offshore ASA | Lamar Advertising vs. Yuexiu Transport Infrastructure |
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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