Correlation Between Eastroc Beverage and Kailong High
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By analyzing existing cross correlation between Eastroc Beverage Group and Kailong High Technology, you can compare the effects of market volatilities on Eastroc Beverage and Kailong High 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 Eastroc Beverage with a short position of Kailong High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastroc Beverage and Kailong High.
Diversification Opportunities for Eastroc Beverage and Kailong High
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eastroc and Kailong is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Eastroc Beverage Group and Kailong High Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kailong High Technology and Eastroc Beverage 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 Eastroc Beverage Group are associated (or correlated) with Kailong High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kailong High Technology has no effect on the direction of Eastroc Beverage i.e., Eastroc Beverage and Kailong High go up and down completely randomly.
Pair Corralation between Eastroc Beverage and Kailong High
Assuming the 90 days trading horizon Eastroc Beverage Group is expected to under-perform the Kailong High. But the stock apears to be less risky and, when comparing its historical volatility, Eastroc Beverage Group is 1.08 times less risky than Kailong High. The stock trades about -0.14 of its potential returns per unit of risk. The Kailong High Technology is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 1,040 in Kailong High Technology on November 7, 2024 and sell it today you would earn a total of 208.00 from holding Kailong High Technology or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastroc Beverage Group vs. Kailong High Technology
Performance |
| Timeline |
| Eastroc Beverage |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Kailong High Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Eastroc Beverage and Kailong High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastroc Beverage and Kailong High
The main advantage of trading using opposite Eastroc Beverage and Kailong High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastroc Beverage position performs unexpectedly, Kailong High 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 Kailong High will offset losses from the drop in Kailong High's long position.The idea behind Eastroc Beverage Group and Kailong High Technology 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.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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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