Correlation Between Wha Yu and Yageo Corp
Can any of the company-specific risk be diversified away by investing in both Wha Yu and Yageo 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 Wha Yu and Yageo Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wha Yu Industrial and Yageo Corp, you can compare the effects of market volatilities on Wha Yu and Yageo 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 Wha Yu with a short position of Yageo Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wha Yu and Yageo Corp.
Diversification Opportunities for Wha Yu and Yageo Corp
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wha and Yageo is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Wha Yu Industrial and Yageo Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yageo Corp and Wha Yu 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 Wha Yu Industrial are associated (or correlated) with Yageo Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yageo Corp has no effect on the direction of Wha Yu i.e., Wha Yu and Yageo Corp go up and down completely randomly.
Pair Corralation between Wha Yu and Yageo Corp
Assuming the 90 days trading horizon Wha Yu is expected to generate 1.37 times less return on investment than Yageo Corp. In addition to that, Wha Yu is 1.09 times more volatile than Yageo Corp. It trades about 0.01 of its total potential returns per unit of risk. Yageo Corp is currently generating about 0.01 per unit of volatility. If you would invest 53,200 in Yageo Corp on October 14, 2024 and sell it today you would earn a total of 400.00 from holding Yageo Corp or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wha Yu Industrial vs. Yageo Corp
Performance |
| Timeline |
| Wha Yu Industrial |
| Yageo Corp |
Wha Yu and Yageo Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wha Yu and Yageo Corp
The main advantage of trading using opposite Wha Yu and Yageo Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wha Yu position performs unexpectedly, Yageo 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 Yageo Corp will offset losses from the drop in Yageo Corp's long position.| Wha Yu vs. Gemtek Technology Co | Wha Yu vs. Arcadyan Technology Corp | Wha Yu vs. Zinwell | Wha Yu vs. Silitech Technology Corp |
| Yageo Corp vs. Grand Ocean Retail | Yageo Corp vs. Camellia Metal Co | Yageo Corp vs. Unique Optical Industrial | Yageo Corp vs. Wha Yu Industrial |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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