Correlation Between Chinyang Hold and Eagon Industrial
Can any of the company-specific risk be diversified away by investing in both Chinyang Hold 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 Chinyang Hold and Eagon Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chinyang Hold and Eagon Industrial Co, you can compare the effects of market volatilities on Chinyang Hold 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 Chinyang Hold with a short position of Eagon Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinyang Hold and Eagon Industrial.
Diversification Opportunities for Chinyang Hold and Eagon Industrial
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Chinyang and Eagon is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Chinyang Hold and Eagon Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagon Industrial and Chinyang Hold 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 Chinyang Hold 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 Chinyang Hold i.e., Chinyang Hold and Eagon Industrial go up and down completely randomly.
Pair Corralation between Chinyang Hold and Eagon Industrial
Assuming the 90 days trading horizon Chinyang Hold is expected to generate 0.2 times more return on investment than Eagon Industrial. However, Chinyang Hold is 5.03 times less risky than Eagon Industrial. It trades about -0.08 of its potential returns per unit of risk. Eagon Industrial Co is currently generating about -0.04 per unit of risk. If you would invest 319,500 in Chinyang Hold on September 3, 2024 and sell it today you would lose (4,500) from holding Chinyang Hold or give up 1.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chinyang Hold vs. Eagon Industrial Co
Performance |
| Timeline |
| Chinyang Hold |
| Eagon Industrial |
Chinyang Hold and Eagon Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chinyang Hold and Eagon Industrial
The main advantage of trading using opposite Chinyang Hold and Eagon Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chinyang Hold 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.| Chinyang Hold vs. Eagon Industrial Co | Chinyang Hold vs. Myoung Shin Industrial | Chinyang Hold vs. UJU Electronics Co | Chinyang Hold vs. MetaLabs Co |
| Eagon Industrial vs. CU Tech Corp | Eagon Industrial vs. Konan Technology | Eagon Industrial vs. Digital Power Communications | Eagon Industrial vs. Sungchang Autotech Co |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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