Correlation Between Big Camera and Everland Public
Can any of the company-specific risk be diversified away by investing in both Big Camera and Everland Public 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 Big Camera and Everland Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big Camera and Everland Public, you can compare the effects of market volatilities on Big Camera and Everland Public 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 Big Camera with a short position of Everland Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Camera and Everland Public.
Diversification Opportunities for Big Camera and Everland Public
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Big and Everland is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Big Camera and Everland Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everland Public and Big Camera 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 Big Camera are associated (or correlated) with Everland Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everland Public has no effect on the direction of Big Camera i.e., Big Camera and Everland Public go up and down completely randomly.
Pair Corralation between Big Camera and Everland Public
Assuming the 90 days trading horizon Big Camera is expected to generate 1.03 times less return on investment than Everland Public. But when comparing it to its historical volatility, Big Camera is 1.0 times less risky than Everland Public. It trades about 0.04 of its potential returns per unit of risk. Everland Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Everland Public on August 31, 2024 and sell it today you would lose (10.00) from holding Everland Public or give up 43.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Big Camera vs. Everland Public
Performance |
| Timeline |
| Big Camera |
| Everland Public |
Big Camera and Everland Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Camera and Everland Public
The main advantage of trading using opposite Big Camera and Everland Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Camera position performs unexpectedly, Everland Public 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 Everland Public will offset losses from the drop in Everland Public's long position.| Big Camera vs. Ananda Development Public | Big Camera vs. Beauty Community Public | Big Camera vs. Asia Aviation Public | Big Camera vs. Gunkul Engineering Public |
| Everland Public vs. Eastern Star Real | Everland Public vs. Big Camera | Everland Public vs. EMC Public | Everland Public vs. Country Group Development |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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