Correlation Between Evergreen Marine and AMPACS Corp
Can any of the company-specific risk be diversified away by investing in both Evergreen Marine and AMPACS Corp 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 AMPACS Corp 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 AMPACS Corp, you can compare the effects of market volatilities on Evergreen Marine and AMPACS Corp 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 AMPACS Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen Marine and AMPACS Corp.
Diversification Opportunities for Evergreen Marine and AMPACS Corp
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Evergreen and AMPACS is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen Marine Corp and AMPACS Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMPACS Corp 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 AMPACS Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMPACS Corp has no effect on the direction of Evergreen Marine i.e., Evergreen Marine and AMPACS Corp go up and down completely randomly.
Pair Corralation between Evergreen Marine and AMPACS Corp
Assuming the 90 days trading horizon Evergreen Marine Corp is expected to under-perform the AMPACS Corp. In addition to that, Evergreen Marine is 1.38 times more volatile than AMPACS Corp. It trades about -0.28 of its total potential returns per unit of risk. AMPACS Corp is currently generating about 0.12 per unit of volatility. If you would invest 4,030 in AMPACS Corp on October 21, 2024 and sell it today you would earn a total of 150.00 from holding AMPACS Corp or generate 3.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evergreen Marine Corp vs. AMPACS Corp
Performance |
| Timeline |
| Evergreen Marine Corp |
| AMPACS Corp |
Evergreen Marine and AMPACS Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evergreen Marine and AMPACS Corp
The main advantage of trading using opposite Evergreen Marine and AMPACS Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen Marine position performs unexpectedly, AMPACS Corp 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 AMPACS Corp will offset losses from the drop in AMPACS Corp'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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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