Correlation Between Victory New and Green World
Can any of the company-specific risk be diversified away by investing in both Victory New and Green World 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 Victory New and Green World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory New Materials and Green World Fintech, you can compare the effects of market volatilities on Victory New and Green World 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 Victory New with a short position of Green World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory New and Green World.
Diversification Opportunities for Victory New and Green World
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Victory and Green is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Victory New Materials and Green World Fintech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green World Fintech and Victory New 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 Victory New Materials are associated (or correlated) with Green World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green World Fintech has no effect on the direction of Victory New i.e., Victory New and Green World go up and down completely randomly.
Pair Corralation between Victory New and Green World
Assuming the 90 days trading horizon Victory New Materials is expected to generate 0.33 times more return on investment than Green World. However, Victory New Materials is 3.07 times less risky than Green World. It trades about -0.06 of its potential returns per unit of risk. Green World Fintech is currently generating about -0.21 per unit of risk. If you would invest 1,010 in Victory New Materials on September 1, 2024 and sell it today you would lose (16.00) from holding Victory New Materials or give up 1.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory New Materials vs. Green World Fintech
Performance |
| Timeline |
| Victory New Materials |
| Green World Fintech |
Victory New and Green World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory New and Green World
The main advantage of trading using opposite Victory New and Green World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory New position performs unexpectedly, Green World 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 Green World will offset losses from the drop in Green World's long position.| Victory New vs. Asia Plastic Recycling | Victory New vs. Hunya Foods Co | Victory New vs. Jinli Group Holdings | Victory New vs. Kwong Fong Industries |
| Green World vs. Advanced Echem Materials | Green World vs. Hi Lai Foods Co | Green World vs. Victory New Materials | Green World vs. Elite Material 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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