Correlation Between DR and Yantai North
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By analyzing existing cross correlation between DR Limited and Yantai North Andre, you can compare the effects of market volatilities on DR and Yantai North 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 DR with a short position of Yantai North. Check out your portfolio center. Please also check ongoing floating volatility patterns of DR and Yantai North.
Diversification Opportunities for DR and Yantai North
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DR and Yantai is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding DR Limited and Yantai North Andre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yantai North Andre and DR 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 DR Limited are associated (or correlated) with Yantai North. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yantai North Andre has no effect on the direction of DR i.e., DR and Yantai North go up and down completely randomly.
Pair Corralation between DR and Yantai North
Assuming the 90 days trading horizon DR is expected to generate 1.27 times less return on investment than Yantai North. In addition to that, DR is 1.71 times more volatile than Yantai North Andre. It trades about 0.06 of its total potential returns per unit of risk. Yantai North Andre is currently generating about 0.13 per unit of volatility. If you would invest 2,812 in Yantai North Andre on October 31, 2024 and sell it today you would earn a total of 141.00 from holding Yantai North Andre or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DR Limited vs. Yantai North Andre
Performance |
| Timeline |
| DR Limited |
| Yantai North Andre |
DR and Yantai North Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DR and Yantai North
The main advantage of trading using opposite DR and Yantai North positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DR position performs unexpectedly, Yantai North 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 Yantai North will offset losses from the drop in Yantai North's long position.The idea behind DR Limited and Yantai North Andre pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Yantai North vs. Zoy Home Furnishing | Yantai North vs. Ningbo Homelink Eco iTech | Yantai North vs. Ziel Home Furnishing | Yantai North vs. Holitech Technology 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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