Correlation Between EBEST Investment and Eugene Technology
Can any of the company-specific risk be diversified away by investing in both EBEST Investment and Eugene Technology 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 EBEST Investment and Eugene Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EBEST Investment Securities and Eugene Technology CoLtd, you can compare the effects of market volatilities on EBEST Investment and Eugene Technology 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 EBEST Investment with a short position of Eugene Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of EBEST Investment and Eugene Technology.
Diversification Opportunities for EBEST Investment and Eugene Technology
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EBEST and Eugene is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding EBEST Investment Securities and Eugene Technology CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eugene Technology CoLtd and EBEST Investment 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 EBEST Investment Securities are associated (or correlated) with Eugene Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eugene Technology CoLtd has no effect on the direction of EBEST Investment i.e., EBEST Investment and Eugene Technology go up and down completely randomly.
Pair Corralation between EBEST Investment and Eugene Technology
Assuming the 90 days trading horizon EBEST Investment is expected to generate 16.42 times less return on investment than Eugene Technology. But when comparing it to its historical volatility, EBEST Investment Securities is 1.82 times less risky than Eugene Technology. It trades about 0.0 of its potential returns per unit of risk. Eugene Technology CoLtd is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,874,828 in Eugene Technology CoLtd on August 30, 2024 and sell it today you would earn a total of 645,172 from holding Eugene Technology CoLtd or generate 22.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EBEST Investment Securities vs. Eugene Technology CoLtd
Performance |
| Timeline |
| EBEST Investment Sec |
| Eugene Technology CoLtd |
EBEST Investment and Eugene Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EBEST Investment and Eugene Technology
The main advantage of trading using opposite EBEST Investment and Eugene Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EBEST Investment position performs unexpectedly, Eugene Technology 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 Eugene Technology will offset losses from the drop in Eugene Technology's long position.| EBEST Investment vs. Cube Entertainment | EBEST Investment vs. Dreamus Company | EBEST Investment vs. LG Energy Solution | EBEST Investment vs. Dongwon System |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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