Correlation Between Yang Ming and GTM Holdings
Can any of the company-specific risk be diversified away by investing in both Yang Ming and GTM Holdings 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 Yang Ming and GTM Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yang Ming Marine and GTM Holdings Corp, you can compare the effects of market volatilities on Yang Ming and GTM Holdings 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 Yang Ming with a short position of GTM Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yang Ming and GTM Holdings.
Diversification Opportunities for Yang Ming and GTM Holdings
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Yang and GTM is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Yang Ming Marine and GTM Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GTM Holdings Corp and Yang Ming 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 Yang Ming Marine are associated (or correlated) with GTM Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GTM Holdings Corp has no effect on the direction of Yang Ming i.e., Yang Ming and GTM Holdings go up and down completely randomly.
Pair Corralation between Yang Ming and GTM Holdings
Assuming the 90 days trading horizon Yang Ming Marine is expected to generate 4.0 times more return on investment than GTM Holdings. However, Yang Ming is 4.0 times more volatile than GTM Holdings Corp. It trades about 0.22 of its potential returns per unit of risk. GTM Holdings Corp is currently generating about 0.08 per unit of risk. If you would invest 6,810 in Yang Ming Marine on September 5, 2024 and sell it today you would earn a total of 760.00 from holding Yang Ming Marine or generate 11.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yang Ming Marine vs. GTM Holdings Corp
Performance |
| Timeline |
| Yang Ming Marine |
| GTM Holdings Corp |
Yang Ming and GTM Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yang Ming and GTM Holdings
The main advantage of trading using opposite Yang Ming and GTM Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yang Ming position performs unexpectedly, GTM Holdings 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 GTM Holdings will offset losses from the drop in GTM Holdings' long position.| Yang Ming vs. Evergreen Marine Corp | Yang Ming vs. Wan Hai Lines | Yang Ming vs. China Airlines | Yang Ming vs. Eva Airways Corp |
| GTM Holdings vs. Taiwan Semiconductor Manufacturing | GTM Holdings vs. Yang Ming Marine | GTM Holdings vs. AU Optronics | GTM Holdings vs. Nan Ya Plastics |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |