Correlation Between Better Choice and YanGuFang International
Can any of the company-specific risk be diversified away by investing in both Better Choice and YanGuFang International 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 Better Choice and YanGuFang International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Better Choice and YanGuFang International Group, you can compare the effects of market volatilities on Better Choice and YanGuFang International 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 Better Choice with a short position of YanGuFang International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Better Choice and YanGuFang International.
Diversification Opportunities for Better Choice and YanGuFang International
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Better and YanGuFang is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Better Choice and YanGuFang International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YanGuFang International and Better Choice 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 Better Choice are associated (or correlated) with YanGuFang International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YanGuFang International has no effect on the direction of Better Choice i.e., Better Choice and YanGuFang International go up and down completely randomly.
Pair Corralation between Better Choice and YanGuFang International
If you would invest 170.00 in Better Choice on August 30, 2024 and sell it today you would earn a total of 26.00 from holding Better Choice or generate 15.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Better Choice vs. YanGuFang International Group
Performance |
| Timeline |
| Better Choice |
| YanGuFang International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Better Choice and YanGuFang International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Better Choice and YanGuFang International
The main advantage of trading using opposite Better Choice and YanGuFang International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Better Choice position performs unexpectedly, YanGuFang International 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 YanGuFang International will offset losses from the drop in YanGuFang International's long position.| Better Choice vs. Blue Star Foods | Better Choice vs. Stryve Foods | Better Choice vs. BioAdaptives | Better Choice vs. Beyond Oil |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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