Correlation Between Evergreen International and Hung Sheng
Can any of the company-specific risk be diversified away by investing in both Evergreen International and Hung Sheng 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 International and Hung Sheng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evergreen International Storage and Hung Sheng Construction, you can compare the effects of market volatilities on Evergreen International and Hung Sheng 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 International with a short position of Hung Sheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen International and Hung Sheng.
Diversification Opportunities for Evergreen International and Hung Sheng
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Evergreen and Hung is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen International Storag and Hung Sheng Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hung Sheng Construction and Evergreen International 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 International Storage are associated (or correlated) with Hung Sheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hung Sheng Construction has no effect on the direction of Evergreen International i.e., Evergreen International and Hung Sheng go up and down completely randomly.
Pair Corralation between Evergreen International and Hung Sheng
Assuming the 90 days trading horizon Evergreen International is expected to generate 23.2 times less return on investment than Hung Sheng. But when comparing it to its historical volatility, Evergreen International Storage is 1.39 times less risky than Hung Sheng. It trades about 0.01 of its potential returns per unit of risk. Hung Sheng Construction is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,630 in Hung Sheng Construction on August 29, 2024 and sell it today you would earn a total of 85.00 from holding Hung Sheng Construction or generate 3.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evergreen International Storag vs. Hung Sheng Construction
Performance |
| Timeline |
| Evergreen International |
| Hung Sheng Construction |
Evergreen International and Hung Sheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evergreen International and Hung Sheng
The main advantage of trading using opposite Evergreen International and Hung Sheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen International position performs unexpectedly, Hung Sheng 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 Hung Sheng will offset losses from the drop in Hung Sheng's long position.| Evergreen International vs. Yulon Motor Co | Evergreen International vs. Far Eastern Department | Evergreen International vs. China Steel Corp | Evergreen International vs. Chang Hwa Commercial |
| Hung Sheng vs. Tainan Spinning Co | Hung Sheng vs. Carnival Industrial Corp | Hung Sheng vs. Symtek Automation Asia | Hung Sheng vs. CTCI Corp |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |