Correlation Between Yulon Finance and De Licacy
Can any of the company-specific risk be diversified away by investing in both Yulon Finance and De Licacy 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 Yulon Finance and De Licacy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yulon Finance Corp and De Licacy Industrial, you can compare the effects of market volatilities on Yulon Finance and De Licacy 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 Yulon Finance with a short position of De Licacy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yulon Finance and De Licacy.
Diversification Opportunities for Yulon Finance and De Licacy
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Yulon and 1464 is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Yulon Finance Corp and De Licacy Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on De Licacy Industrial and Yulon Finance 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 Yulon Finance Corp are associated (or correlated) with De Licacy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of De Licacy Industrial has no effect on the direction of Yulon Finance i.e., Yulon Finance and De Licacy go up and down completely randomly.
Pair Corralation between Yulon Finance and De Licacy
Assuming the 90 days trading horizon Yulon Finance Corp is expected to under-perform the De Licacy. In addition to that, Yulon Finance is 1.17 times more volatile than De Licacy Industrial. It trades about -0.04 of its total potential returns per unit of risk. De Licacy Industrial is currently generating about 0.03 per unit of volatility. If you would invest 1,530 in De Licacy Industrial on November 27, 2024 and sell it today you would earn a total of 320.00 from holding De Licacy Industrial or generate 20.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yulon Finance Corp vs. De Licacy Industrial
Performance |
| Timeline |
| Yulon Finance Corp |
| De Licacy Industrial |
Yulon Finance and De Licacy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yulon Finance and De Licacy
The main advantage of trading using opposite Yulon Finance and De Licacy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yulon Finance position performs unexpectedly, De Licacy 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 De Licacy will offset losses from the drop in De Licacy's long position.| Yulon Finance vs. Chailease Holding Co | Yulon Finance vs. Taiwan Secom Co | Yulon Finance vs. TTET Union Corp | Yulon Finance vs. China Steel Chemical |
| De Licacy vs. Tainan Enterprises Co | De Licacy vs. Nien Hsing Textile | De Licacy vs. Wisher Industrial Co | De Licacy vs. Tex Ray Industrial 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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