Correlation Between BYD Co and EmbedWay TechCorp
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By analyzing existing cross correlation between BYD Co Ltd and EmbedWay TechCorp, you can compare the effects of market volatilities on BYD Co and EmbedWay TechCorp 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 BYD Co with a short position of EmbedWay TechCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and EmbedWay TechCorp.
Diversification Opportunities for BYD Co and EmbedWay TechCorp
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BYD and EmbedWay is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and EmbedWay TechCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EmbedWay TechCorp and BYD Co 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 BYD Co Ltd are associated (or correlated) with EmbedWay TechCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EmbedWay TechCorp has no effect on the direction of BYD Co i.e., BYD Co and EmbedWay TechCorp go up and down completely randomly.
Pair Corralation between BYD Co and EmbedWay TechCorp
Assuming the 90 days trading horizon BYD Co is expected to generate 20.89 times less return on investment than EmbedWay TechCorp. But when comparing it to its historical volatility, BYD Co Ltd is 2.09 times less risky than EmbedWay TechCorp. It trades about 0.01 of its potential returns per unit of risk. EmbedWay TechCorp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,238 in EmbedWay TechCorp on October 16, 2024 and sell it today you would earn a total of 1,031 from holding EmbedWay TechCorp or generate 83.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. EmbedWay TechCorp
Performance |
| Timeline |
| BYD Co |
| EmbedWay TechCorp |
BYD Co and EmbedWay TechCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and EmbedWay TechCorp
The main advantage of trading using opposite BYD Co and EmbedWay TechCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, EmbedWay TechCorp 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 EmbedWay TechCorp will offset losses from the drop in EmbedWay TechCorp's long position.| BYD Co vs. Guangdong Qunxing Toys | BYD Co vs. Innovative Medical Management | BYD Co vs. Kingclean Electric Co | BYD Co vs. Guangzhou Restaurants Group |
| EmbedWay TechCorp vs. Kweichow Moutai Co | EmbedWay TechCorp vs. NAURA Technology Group | EmbedWay TechCorp vs. Zhejiang Orient Gene | EmbedWay TechCorp vs. APT Medical |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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