Correlation Between Ecopro BM and APro
Can any of the company-specific risk be diversified away by investing in both Ecopro BM and APro 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 Ecopro BM and APro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecopro BM Co and APro Co, you can compare the effects of market volatilities on Ecopro BM and APro 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 Ecopro BM with a short position of APro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecopro BM and APro.
Diversification Opportunities for Ecopro BM and APro
Almost no diversification
The 3 months correlation between Ecopro and APro is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ecopro BM Co and APro Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APro and Ecopro BM 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 Ecopro BM Co are associated (or correlated) with APro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APro has no effect on the direction of Ecopro BM i.e., Ecopro BM and APro go up and down completely randomly.
Pair Corralation between Ecopro BM and APro
Assuming the 90 days trading horizon Ecopro BM Co is expected to generate 1.62 times more return on investment than APro. However, Ecopro BM is 1.62 times more volatile than APro Co. It trades about -0.07 of its potential returns per unit of risk. APro Co is currently generating about -0.16 per unit of risk. If you would invest 28,350,000 in Ecopro BM Co on August 25, 2024 and sell it today you would lose (14,810,000) from holding Ecopro BM Co or give up 52.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecopro BM Co vs. APro Co
Performance |
| Timeline |
| Ecopro BM |
| APro |
Ecopro BM and APro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecopro BM and APro
The main advantage of trading using opposite Ecopro BM and APro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecopro BM position performs unexpectedly, APro 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 APro will offset losses from the drop in APro's long position.| Ecopro BM vs. Shin Heung Energy | Ecopro BM vs. Sangsin Energy Display | Ecopro BM vs. Amogreentech CoLtd | Ecopro BM vs. Bosung Power Technology |
| APro vs. DAEDUCK ELECTRONICS CoLtd | APro vs. Air Busan Co | APro vs. Samji Electronics Co | APro vs. Sungmoon Electronics 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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