Correlation Between Bangyan Technology and Yoantion Industrial
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By analyzing existing cross correlation between Bangyan Technology Co and Yoantion Industrial IncLtd, you can compare the effects of market volatilities on Bangyan Technology and Yoantion 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 Bangyan Technology with a short position of Yoantion Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bangyan Technology and Yoantion Industrial.
Diversification Opportunities for Bangyan Technology and Yoantion Industrial
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bangyan and Yoantion is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bangyan Technology Co and Yoantion Industrial IncLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yoantion Industrial and Bangyan Technology 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 Bangyan Technology Co are associated (or correlated) with Yoantion Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yoantion Industrial has no effect on the direction of Bangyan Technology i.e., Bangyan Technology and Yoantion Industrial go up and down completely randomly.
Pair Corralation between Bangyan Technology and Yoantion Industrial
Assuming the 90 days trading horizon Bangyan Technology Co is expected to under-perform the Yoantion Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Bangyan Technology Co is 1.22 times less risky than Yoantion Industrial. The stock trades about -0.02 of its potential returns per unit of risk. The Yoantion Industrial IncLtd is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,559 in Yoantion Industrial IncLtd on September 3, 2024 and sell it today you would lose (306.00) from holding Yoantion Industrial IncLtd or give up 11.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.58% |
| Values | Daily Returns |
Bangyan Technology Co vs. Yoantion Industrial IncLtd
Performance |
| Timeline |
| Bangyan Technology |
| Yoantion Industrial |
Bangyan Technology and Yoantion Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bangyan Technology and Yoantion Industrial
The main advantage of trading using opposite Bangyan Technology and Yoantion Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bangyan Technology position performs unexpectedly, Yoantion 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 Yoantion Industrial will offset losses from the drop in Yoantion Industrial's long position.The idea behind Bangyan Technology Co and Yoantion Industrial IncLtd 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.
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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