Correlation Between Xavis and EV Advanced
Can any of the company-specific risk be diversified away by investing in both Xavis and EV Advanced 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 Xavis and EV Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xavis Co and EV Advanced Material, you can compare the effects of market volatilities on Xavis and EV Advanced 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 Xavis with a short position of EV Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xavis and EV Advanced.
Diversification Opportunities for Xavis and EV Advanced
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xavis and 131400 is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Xavis Co and EV Advanced Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EV Advanced Material and Xavis 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 Xavis Co are associated (or correlated) with EV Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EV Advanced Material has no effect on the direction of Xavis i.e., Xavis and EV Advanced go up and down completely randomly.
Pair Corralation between Xavis and EV Advanced
Assuming the 90 days trading horizon Xavis Co is expected to generate 2.71 times more return on investment than EV Advanced. However, Xavis is 2.71 times more volatile than EV Advanced Material. It trades about 0.12 of its potential returns per unit of risk. EV Advanced Material is currently generating about 0.2 per unit of risk. If you would invest 143,000 in Xavis Co on December 1, 2024 and sell it today you would earn a total of 19,800 from holding Xavis Co or generate 13.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xavis Co vs. EV Advanced Material
Performance |
| Timeline |
| Xavis |
| EV Advanced Material |
Xavis and EV Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xavis and EV Advanced
The main advantage of trading using opposite Xavis and EV Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xavis position performs unexpectedly, EV Advanced 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 EV Advanced will offset losses from the drop in EV Advanced's long position.| Xavis vs. Haitai Confectionery Foods | Xavis vs. Korean Reinsurance Co | Xavis vs. Shinhan Inverse Silver | Xavis vs. Digital Imaging Technology |
| EV Advanced vs. Sejong Telecom | EV Advanced vs. LG Household Healthcare | EV Advanced vs. LG Household Healthcare | EV Advanced vs. SK Telecom 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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