Correlation Between Yageo Corp and KYE Systems
Can any of the company-specific risk be diversified away by investing in both Yageo Corp and KYE Systems 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 Yageo Corp and KYE Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yageo Corp and KYE Systems Corp, you can compare the effects of market volatilities on Yageo Corp and KYE Systems 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 Yageo Corp with a short position of KYE Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yageo Corp and KYE Systems.
Diversification Opportunities for Yageo Corp and KYE Systems
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Yageo and KYE is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Yageo Corp and KYE Systems Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KYE Systems Corp and Yageo Corp 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 Yageo Corp are associated (or correlated) with KYE Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KYE Systems Corp has no effect on the direction of Yageo Corp i.e., Yageo Corp and KYE Systems go up and down completely randomly.
Pair Corralation between Yageo Corp and KYE Systems
Assuming the 90 days trading horizon Yageo Corp is expected to generate 0.7 times more return on investment than KYE Systems. However, Yageo Corp is 1.43 times less risky than KYE Systems. It trades about 0.05 of its potential returns per unit of risk. KYE Systems Corp is currently generating about -0.23 per unit of risk. If you would invest 52,900 in Yageo Corp on October 25, 2024 and sell it today you would earn a total of 800.00 from holding Yageo Corp or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yageo Corp vs. KYE Systems Corp
Performance |
| Timeline |
| Yageo Corp |
| KYE Systems Corp |
Yageo Corp and KYE Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yageo Corp and KYE Systems
The main advantage of trading using opposite Yageo Corp and KYE Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yageo Corp position performs unexpectedly, KYE Systems 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 KYE Systems will offset losses from the drop in KYE Systems' long position.| Yageo Corp vs. Elite Semiconductor Memory | Yageo Corp vs. Sunny Friend Environmental | Yageo Corp vs. Century Iron And | Yageo Corp vs. Chia Yi Steel |
| KYE Systems vs. Avision | KYE Systems vs. Ability Enterprise Co | KYE Systems vs. Clevo Co | KYE Systems vs. Silicon Integrated Systems |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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