Correlation Between Yang Ming and Anderson Industrial
Can any of the company-specific risk be diversified away by investing in both Yang Ming and Anderson Industrial 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 Anderson Industrial 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 Anderson Industrial Corp, you can compare the effects of market volatilities on Yang Ming and Anderson Industrial 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 Anderson Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yang Ming and Anderson Industrial.
Diversification Opportunities for Yang Ming and Anderson Industrial
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Yang and Anderson is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Yang Ming Marine and Anderson Industrial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anderson Industrial 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 Anderson Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anderson Industrial Corp has no effect on the direction of Yang Ming i.e., Yang Ming and Anderson Industrial go up and down completely randomly.
Pair Corralation between Yang Ming and Anderson Industrial
Assuming the 90 days trading horizon Yang Ming Marine is expected to generate 1.32 times more return on investment than Anderson Industrial. However, Yang Ming is 1.32 times more volatile than Anderson Industrial Corp. It trades about 0.16 of its potential returns per unit of risk. Anderson Industrial Corp is currently generating about -0.28 per unit of risk. If you would invest 7,210 in Yang Ming Marine on September 13, 2024 and sell it today you would earn a total of 710.00 from holding Yang Ming Marine or generate 9.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Yang Ming Marine vs. Anderson Industrial Corp
Performance |
| Timeline |
| Yang Ming Marine |
| Anderson Industrial Corp |
Yang Ming and Anderson Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yang Ming and Anderson Industrial
The main advantage of trading using opposite Yang Ming and Anderson Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yang Ming position performs unexpectedly, Anderson Industrial 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 Anderson Industrial will offset losses from the drop in Anderson Industrial's 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 |
| Anderson Industrial vs. Yang Ming Marine | Anderson Industrial vs. Wan Hai Lines | Anderson Industrial vs. U Ming Marine Transport | Anderson Industrial vs. Taiwan Navigation Co |
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 CEOs Directory module to screen CEOs from public companies around the world.
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