Correlation Between Evergreen Marine and YeaShin International
Can any of the company-specific risk be diversified away by investing in both Evergreen Marine and YeaShin International 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 YeaShin International 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 YeaShin International Development, you can compare the effects of market volatilities on Evergreen Marine and YeaShin International 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 YeaShin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen Marine and YeaShin International.
Diversification Opportunities for Evergreen Marine and YeaShin International
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Evergreen and YeaShin is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen Marine Corp and YeaShin International Developm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YeaShin International 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 YeaShin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YeaShin International has no effect on the direction of Evergreen Marine i.e., Evergreen Marine and YeaShin International go up and down completely randomly.
Pair Corralation between Evergreen Marine and YeaShin International
Assuming the 90 days trading horizon Evergreen Marine is expected to generate 4.11 times less return on investment than YeaShin International. But when comparing it to its historical volatility, Evergreen Marine Corp is 5.77 times less risky than YeaShin International. It trades about 0.07 of its potential returns per unit of risk. YeaShin International Development is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,341 in YeaShin International Development on August 30, 2024 and sell it today you would lose (281.00) from holding YeaShin International Development or give up 8.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evergreen Marine Corp vs. YeaShin International Developm
Performance |
| Timeline |
| Evergreen Marine Corp |
| YeaShin International |
Evergreen Marine and YeaShin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evergreen Marine and YeaShin International
The main advantage of trading using opposite Evergreen Marine and YeaShin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen Marine position performs unexpectedly, YeaShin International 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 YeaShin International will offset losses from the drop in YeaShin International's long position.| Evergreen Marine vs. Yulon Motor Co | Evergreen Marine vs. Far Eastern Department | Evergreen Marine vs. China Steel Corp | Evergreen Marine vs. Chang Hwa Commercial |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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