Correlation Between Showbox Corp and Eagon Industrial
Can any of the company-specific risk be diversified away by investing in both Showbox Corp and Eagon Industrial 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 Showbox Corp and Eagon Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Showbox Corp and Eagon Industrial Co, you can compare the effects of market volatilities on Showbox Corp and Eagon Industrial 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 Showbox Corp with a short position of Eagon Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Showbox Corp and Eagon Industrial.
Diversification Opportunities for Showbox Corp and Eagon Industrial
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Showbox and Eagon is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Showbox Corp and Eagon Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagon Industrial and Showbox Corp 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 Showbox Corp are associated (or correlated) with Eagon Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagon Industrial has no effect on the direction of Showbox Corp i.e., Showbox Corp and Eagon Industrial go up and down completely randomly.
Pair Corralation between Showbox Corp and Eagon Industrial
Assuming the 90 days trading horizon Showbox Corp is expected to under-perform the Eagon Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Showbox Corp is 1.84 times less risky than Eagon Industrial. The stock trades about -0.31 of its potential returns per unit of risk. The Eagon Industrial Co is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 508,038 in Eagon Industrial Co on October 25, 2024 and sell it today you would earn a total of 64,962 from holding Eagon Industrial Co or generate 12.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Showbox Corp vs. Eagon Industrial Co
Performance |
| Timeline |
| Showbox Corp |
| Eagon Industrial |
Showbox Corp and Eagon Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Showbox Corp and Eagon Industrial
The main advantage of trading using opposite Showbox Corp and Eagon Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Showbox Corp position performs unexpectedly, Eagon Industrial 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 Eagon Industrial will offset losses from the drop in Eagon Industrial's long position.| Showbox Corp vs. Eagon Industrial Co | Showbox Corp vs. DRB Industrial Co | Showbox Corp vs. Hotel Shilla Co | Showbox Corp vs. Grand Korea Leisure |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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