Correlation Between Evergreen Marine and Yuan High
Can any of the company-specific risk be diversified away by investing in both Evergreen Marine and Yuan High 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 Yuan High 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 Yuan High Tech Development, you can compare the effects of market volatilities on Evergreen Marine and Yuan High 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 Yuan High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen Marine and Yuan High.
Diversification Opportunities for Evergreen Marine and Yuan High
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Evergreen and Yuan is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen Marine Corp and Yuan High Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuan High Tech 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 Yuan High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuan High Tech has no effect on the direction of Evergreen Marine i.e., Evergreen Marine and Yuan High go up and down completely randomly.
Pair Corralation between Evergreen Marine and Yuan High
Assuming the 90 days trading horizon Evergreen Marine Corp is expected to generate 0.71 times more return on investment than Yuan High. However, Evergreen Marine Corp is 1.4 times less risky than Yuan High. It trades about 0.02 of its potential returns per unit of risk. Yuan High Tech Development is currently generating about 0.0 per unit of risk. If you would invest 21,100 in Evergreen Marine Corp on September 2, 2024 and sell it today you would earn a total of 600.00 from holding Evergreen Marine Corp or generate 2.84% 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. Yuan High Tech Development
Performance |
| Timeline |
| Evergreen Marine Corp |
| Yuan High Tech |
Evergreen Marine and Yuan High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evergreen Marine and Yuan High
The main advantage of trading using opposite Evergreen Marine and Yuan High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen Marine position performs unexpectedly, Yuan High 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 Yuan High will offset losses from the drop in Yuan High's long position.| Evergreen Marine vs. Yang Ming Marine | Evergreen Marine vs. Wan Hai Lines | Evergreen Marine vs. Eva Airways Corp | Evergreen Marine vs. China Airlines |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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