Correlation Between Camellia Metal and Trade Van
Can any of the company-specific risk be diversified away by investing in both Camellia Metal 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 Camellia Metal and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camellia Metal Co and Trade Van Information Services, you can compare the effects of market volatilities on Camellia Metal 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 Camellia Metal with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camellia Metal and Trade Van.
Diversification Opportunities for Camellia Metal and Trade Van
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Camellia and Trade is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Camellia Metal Co 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 Camellia Metal 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 Camellia Metal Co 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 Camellia Metal i.e., Camellia Metal and Trade Van go up and down completely randomly.
Pair Corralation between Camellia Metal and Trade Van
Assuming the 90 days trading horizon Camellia Metal Co is expected to under-perform the Trade Van. In addition to that, Camellia Metal is 1.96 times more volatile than Trade Van Information Services. It trades about -0.02 of its total potential returns per unit of risk. Trade Van Information Services is currently generating about 0.09 per unit of volatility. If you would invest 6,420 in Trade Van Information Services on September 2, 2024 and sell it today you would earn a total of 1,670 from holding Trade Van Information Services or generate 26.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Camellia Metal Co vs. Trade Van Information Services
Performance |
| Timeline |
| Camellia Metal |
| Trade Van Information |
Camellia Metal and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camellia Metal and Trade Van
The main advantage of trading using opposite Camellia Metal and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camellia Metal 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.| Camellia Metal vs. Yang Ming Marine | Camellia Metal vs. Wan Hai Lines | Camellia Metal vs. Hsin Kuang Steel | Camellia Metal vs. Evergreen Marine Corp |
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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