Correlation Between Basso Industry and Yieh Phui
Can any of the company-specific risk be diversified away by investing in both Basso Industry and Yieh Phui 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 Basso Industry and Yieh Phui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Basso Industry Corp and Yieh Phui Enterprise, you can compare the effects of market volatilities on Basso Industry and Yieh Phui 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 Basso Industry with a short position of Yieh Phui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Basso Industry and Yieh Phui.
Diversification Opportunities for Basso Industry and Yieh Phui
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Basso and Yieh is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Basso Industry Corp and Yieh Phui Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yieh Phui Enterprise and Basso Industry 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 Basso Industry Corp are associated (or correlated) with Yieh Phui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yieh Phui Enterprise has no effect on the direction of Basso Industry i.e., Basso Industry and Yieh Phui go up and down completely randomly.
Pair Corralation between Basso Industry and Yieh Phui
Assuming the 90 days trading horizon Basso Industry Corp is expected to under-perform the Yieh Phui. In addition to that, Basso Industry is 1.75 times more volatile than Yieh Phui Enterprise. It trades about -0.01 of its total potential returns per unit of risk. Yieh Phui Enterprise is currently generating about 0.0 per unit of volatility. If you would invest 1,520 in Yieh Phui Enterprise on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Yieh Phui Enterprise or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Basso Industry Corp vs. Yieh Phui Enterprise
Performance |
| Timeline |
| Basso Industry Corp |
| Yieh Phui Enterprise |
Basso Industry and Yieh Phui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Basso Industry and Yieh Phui
The main advantage of trading using opposite Basso Industry and Yieh Phui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Basso Industry position performs unexpectedly, Yieh Phui 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 Yieh Phui will offset losses from the drop in Yieh Phui's long position.| Basso Industry vs. Cheng Shin Rubber | Basso Industry vs. Kung Long Batteries | Basso Industry vs. Pou Chen Corp | Basso Industry vs. China Steel Chemical |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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