Correlation Between Evergreen Marine and Trinity Precision
Can any of the company-specific risk be diversified away by investing in both Evergreen Marine and Trinity Precision 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 Evergreen Marine and Trinity Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evergreen Marine Corp and Trinity Precision Technology, you can compare the effects of market volatilities on Evergreen Marine and Trinity Precision 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 Evergreen Marine with a short position of Trinity Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen Marine and Trinity Precision.
Diversification Opportunities for Evergreen Marine and Trinity Precision
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Evergreen and Trinity is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen Marine Corp and Trinity Precision Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trinity Precision and Evergreen Marine 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 Evergreen Marine Corp are associated (or correlated) with Trinity Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trinity Precision has no effect on the direction of Evergreen Marine i.e., Evergreen Marine and Trinity Precision go up and down completely randomly.
Pair Corralation between Evergreen Marine and Trinity Precision
Assuming the 90 days trading horizon Evergreen Marine Corp is expected to generate 1.04 times more return on investment than Trinity Precision. However, Evergreen Marine is 1.04 times more volatile than Trinity Precision Technology. It trades about 0.11 of its potential returns per unit of risk. Trinity Precision Technology is currently generating about -0.17 per unit of risk. If you would invest 20,550 in Evergreen Marine Corp on August 31, 2024 and sell it today you would earn a total of 1,150 from holding Evergreen Marine Corp or generate 5.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evergreen Marine Corp vs. Trinity Precision Technology
Performance |
| Timeline |
| Evergreen Marine Corp |
| Trinity Precision |
Evergreen Marine and Trinity Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evergreen Marine and Trinity Precision
The main advantage of trading using opposite Evergreen Marine and Trinity Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen Marine position performs unexpectedly, Trinity Precision 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 Trinity Precision will offset losses from the drop in Trinity Precision's long position.| Evergreen Marine vs. BES Engineering Co | Evergreen Marine vs. Continental Holdings Corp | Evergreen Marine vs. Kee Tai Properties | Evergreen Marine vs. Hung Sheng Construction |
| Trinity Precision vs. Yeou Yih Steel | Trinity Precision vs. Sunny Friend Environmental | Trinity Precision vs. Ever Clear Environmental Eng | Trinity Precision vs. Chia Yi Steel |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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