Correlation Between Yulon Nissan and BizLink Holding
Can any of the company-specific risk be diversified away by investing in both Yulon Nissan and BizLink Holding 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 Yulon Nissan and BizLink Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yulon Nissan Motor and BizLink Holding, you can compare the effects of market volatilities on Yulon Nissan and BizLink Holding 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 Yulon Nissan with a short position of BizLink Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yulon Nissan and BizLink Holding.
Diversification Opportunities for Yulon Nissan and BizLink Holding
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Yulon and BizLink is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Yulon Nissan Motor and BizLink Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BizLink Holding and Yulon Nissan 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 Yulon Nissan Motor are associated (or correlated) with BizLink Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BizLink Holding has no effect on the direction of Yulon Nissan i.e., Yulon Nissan and BizLink Holding go up and down completely randomly.
Pair Corralation between Yulon Nissan and BizLink Holding
Assuming the 90 days trading horizon Yulon Nissan Motor is expected to generate 0.68 times more return on investment than BizLink Holding. However, Yulon Nissan Motor is 1.47 times less risky than BizLink Holding. It trades about 0.42 of its potential returns per unit of risk. BizLink Holding is currently generating about 0.22 per unit of risk. If you would invest 6,840 in Yulon Nissan Motor on November 27, 2024 and sell it today you would earn a total of 1,200 from holding Yulon Nissan Motor or generate 17.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yulon Nissan Motor vs. BizLink Holding
Performance |
| Timeline |
| Yulon Nissan Motor |
| BizLink Holding |
Yulon Nissan and BizLink Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yulon Nissan and BizLink Holding
The main advantage of trading using opposite Yulon Nissan and BizLink Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yulon Nissan position performs unexpectedly, BizLink Holding 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 BizLink Holding will offset losses from the drop in BizLink Holding's long position.| Yulon Nissan vs. Tainan Enterprises Co | Yulon Nissan vs. De Licacy Industrial | Yulon Nissan vs. Nien Hsing Textile | Yulon Nissan vs. Wisher Industrial Co |
| BizLink Holding vs. Hota Industrial Mfg | BizLink Holding vs. Chroma ATE | BizLink Holding vs. Sinbon Electronics Co | BizLink Holding vs. Tong Hsing Electronic |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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