Correlation Between American Rebel and Yue Yuen
Can any of the company-specific risk be diversified away by investing in both American Rebel and Yue Yuen 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 American Rebel and Yue Yuen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Rebel Holdings and Yue Yuen Industrial, you can compare the effects of market volatilities on American Rebel and Yue Yuen 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 American Rebel with a short position of Yue Yuen. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Rebel and Yue Yuen.
Diversification Opportunities for American Rebel and Yue Yuen
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Yue is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding American Rebel Holdings and Yue Yuen Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yue Yuen Industrial and American Rebel 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 American Rebel Holdings are associated (or correlated) with Yue Yuen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yue Yuen Industrial has no effect on the direction of American Rebel i.e., American Rebel and Yue Yuen go up and down completely randomly.
Pair Corralation between American Rebel and Yue Yuen
Assuming the 90 days horizon American Rebel Holdings is expected to generate 5.6 times more return on investment than Yue Yuen. However, American Rebel is 5.6 times more volatile than Yue Yuen Industrial. It trades about 0.05 of its potential returns per unit of risk. Yue Yuen Industrial is currently generating about 0.17 per unit of risk. If you would invest 1.45 in American Rebel Holdings on September 12, 2024 and sell it today you would lose (0.45) from holding American Rebel Holdings or give up 31.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.63% |
| Values | Daily Returns |
American Rebel Holdings vs. Yue Yuen Industrial
Performance |
| Timeline |
| American Rebel Holdings |
| Yue Yuen Industrial |
American Rebel and Yue Yuen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Rebel and Yue Yuen
The main advantage of trading using opposite American Rebel and Yue Yuen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Rebel position performs unexpectedly, Yue Yuen 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 Yue Yuen will offset losses from the drop in Yue Yuen's long position.| American Rebel vs. Digital Brands Group | American Rebel vs. Data Storage | American Rebel vs. Auddia Inc | American Rebel vs. DatChat Series A |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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