Correlation Between Yulon Finance and Great Tree
Can any of the company-specific risk be diversified away by investing in both Yulon Finance and Great Tree 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 Great Tree 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 Great Tree Pharmacy, you can compare the effects of market volatilities on Yulon Finance and Great Tree 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 Great Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yulon Finance and Great Tree.
Diversification Opportunities for Yulon Finance and Great Tree
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yulon and Great is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Yulon Finance Corp and Great Tree Pharmacy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Tree Pharmacy 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 Great Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Tree Pharmacy has no effect on the direction of Yulon Finance i.e., Yulon Finance and Great Tree go up and down completely randomly.
Pair Corralation between Yulon Finance and Great Tree
Assuming the 90 days trading horizon Yulon Finance Corp is expected to under-perform the Great Tree. In addition to that, Yulon Finance is 1.69 times more volatile than Great Tree Pharmacy. It trades about -0.31 of its total potential returns per unit of risk. Great Tree Pharmacy is currently generating about -0.16 per unit of volatility. If you would invest 17,850 in Great Tree Pharmacy on August 27, 2024 and sell it today you would lose (900.00) from holding Great Tree Pharmacy or give up 5.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yulon Finance Corp vs. Great Tree Pharmacy
Performance |
| Timeline |
| Yulon Finance Corp |
| Great Tree Pharmacy |
Yulon Finance and Great Tree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yulon Finance and Great Tree
The main advantage of trading using opposite Yulon Finance and Great Tree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yulon Finance position performs unexpectedly, Great Tree 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 Great Tree will offset losses from the drop in Great Tree'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 |
| Great Tree vs. Yulon Finance Corp | Great Tree vs. Chailease Holding Co | Great Tree vs. momo Inc | Great Tree vs. Poya International 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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