Correlation Between Grape King and Trade Van
Can any of the company-specific risk be diversified away by investing in both Grape King and Trade Van 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 Grape King and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grape King Bio and Trade Van Information Services, you can compare the effects of market volatilities on Grape King and Trade Van 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 Grape King with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grape King and Trade Van.
Diversification Opportunities for Grape King and Trade Van
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grape and Trade is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Grape King Bio and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information and Grape King 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 Grape King Bio are associated (or correlated) with Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of Grape King i.e., Grape King and Trade Van go up and down completely randomly.
Pair Corralation between Grape King and Trade Van
Assuming the 90 days trading horizon Grape King Bio is expected to generate 0.25 times more return on investment than Trade Van. However, Grape King Bio is 3.98 times less risky than Trade Van. It trades about 0.13 of its potential returns per unit of risk. Trade Van Information Services is currently generating about 0.03 per unit of risk. If you would invest 14,750 in Grape King Bio on November 28, 2024 and sell it today you would earn a total of 250.00 from holding Grape King Bio or generate 1.69% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Grape King Bio vs. Trade Van Information Services
Performance |
Timeline |
Grape King Bio |
Trade Van Information |
Grape King and Trade Van Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Grape King and Trade Van
The main advantage of trading using opposite Grape King and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grape King position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.Grape King vs. Standard Foods Corp | Grape King vs. Eclat Textile Co | Grape King vs. Feng Tay Enterprises | Grape King vs. China Steel Chemical |
Trade Van vs. Taiwan Sakura Corp | Trade Van vs. Charoen Pokphand Enterprise | Trade Van vs. Taiwan Cogeneration Corp | Trade Van vs. Taiwan Secom 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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