Correlation Between EV Advanced and Asiana Airlines
Can any of the company-specific risk be diversified away by investing in both EV Advanced and Asiana Airlines 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 EV Advanced and Asiana Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EV Advanced Material and Asiana Airlines, you can compare the effects of market volatilities on EV Advanced and Asiana Airlines 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 EV Advanced with a short position of Asiana Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of EV Advanced and Asiana Airlines.
Diversification Opportunities for EV Advanced and Asiana Airlines
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 131400 and Asiana is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding EV Advanced Material and Asiana Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiana Airlines and EV Advanced 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 EV Advanced Material are associated (or correlated) with Asiana Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiana Airlines has no effect on the direction of EV Advanced i.e., EV Advanced and Asiana Airlines go up and down completely randomly.
Pair Corralation between EV Advanced and Asiana Airlines
Assuming the 90 days trading horizon EV Advanced Material is expected to generate 1.74 times more return on investment than Asiana Airlines. However, EV Advanced is 1.74 times more volatile than Asiana Airlines. It trades about 0.02 of its potential returns per unit of risk. Asiana Airlines is currently generating about 0.04 per unit of risk. If you would invest 192,100 in EV Advanced Material on October 12, 2024 and sell it today you would earn a total of 800.00 from holding EV Advanced Material or generate 0.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EV Advanced Material vs. Asiana Airlines
Performance |
| Timeline |
| EV Advanced Material |
| Asiana Airlines |
EV Advanced and Asiana Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EV Advanced and Asiana Airlines
The main advantage of trading using opposite EV Advanced and Asiana Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EV Advanced position performs unexpectedly, Asiana Airlines 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 Asiana Airlines will offset losses from the drop in Asiana Airlines' long position.| EV Advanced vs. Shinhan Inverse Silver | EV Advanced vs. A Tech Solution Co | EV Advanced vs. RFTech Co | EV Advanced vs. SEOWONINTECHCoLtd |
| Asiana Airlines vs. Hotel Shilla Co | Asiana Airlines vs. EV Advanced Material | Asiana Airlines vs. Sam Yang Foods | Asiana Airlines vs. Sempio Foods 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 Stocks Directory module to find actively traded stocks across global markets.
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