Correlation Between Yeou Yih and Landis Taipei
Can any of the company-specific risk be diversified away by investing in both Yeou Yih and Landis Taipei 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 Yeou Yih and Landis Taipei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yeou Yih Steel and Landis Taipei Hotel, you can compare the effects of market volatilities on Yeou Yih and Landis Taipei 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 Yeou Yih with a short position of Landis Taipei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yeou Yih and Landis Taipei.
Diversification Opportunities for Yeou Yih and Landis Taipei
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Yeou and Landis is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Yeou Yih Steel and Landis Taipei Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Landis Taipei Hotel and Yeou Yih 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 Yeou Yih Steel are associated (or correlated) with Landis Taipei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Landis Taipei Hotel has no effect on the direction of Yeou Yih i.e., Yeou Yih and Landis Taipei go up and down completely randomly.
Pair Corralation between Yeou Yih and Landis Taipei
Assuming the 90 days trading horizon Yeou Yih Steel is expected to generate 0.46 times more return on investment than Landis Taipei. However, Yeou Yih Steel is 2.19 times less risky than Landis Taipei. It trades about 0.02 of its potential returns per unit of risk. Landis Taipei Hotel is currently generating about 0.01 per unit of risk. If you would invest 1,392 in Yeou Yih Steel on August 29, 2024 and sell it today you would earn a total of 163.00 from holding Yeou Yih Steel or generate 11.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Yeou Yih Steel vs. Landis Taipei Hotel
Performance |
| Timeline |
| Yeou Yih Steel |
| Landis Taipei Hotel |
Yeou Yih and Landis Taipei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yeou Yih and Landis Taipei
The main advantage of trading using opposite Yeou Yih and Landis Taipei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yeou Yih position performs unexpectedly, Landis Taipei 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 Landis Taipei will offset losses from the drop in Landis Taipei's long position.| Yeou Yih vs. China Man Made Fiber | Yeou Yih vs. USI Corp | Yeou Yih vs. China Petrochemical Development | Yeou Yih vs. Yulon Motor Co |
| Landis Taipei vs. Formosa International Hotels | Landis Taipei vs. Ambassador Hotel | Landis Taipei vs. FDC International Hotels | Landis Taipei vs. First Hotel 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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