Correlation Between Ebang International and Teradyne
Can any of the company-specific risk be diversified away by investing in both Ebang International and Teradyne 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 Ebang International and Teradyne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ebang International Holdings and Teradyne, you can compare the effects of market volatilities on Ebang International and Teradyne 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 Ebang International with a short position of Teradyne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ebang International and Teradyne.
Diversification Opportunities for Ebang International and Teradyne
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ebang and Teradyne is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ebang International Holdings and Teradyne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teradyne and Ebang International 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 Ebang International Holdings are associated (or correlated) with Teradyne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teradyne has no effect on the direction of Ebang International i.e., Ebang International and Teradyne go up and down completely randomly.
Pair Corralation between Ebang International and Teradyne
Given the investment horizon of 90 days Ebang International is expected to generate 2.62 times less return on investment than Teradyne. In addition to that, Ebang International is 1.59 times more volatile than Teradyne. It trades about 0.01 of its total potential returns per unit of risk. Teradyne is currently generating about 0.03 per unit of volatility. If you would invest 10,346 in Teradyne on September 1, 2024 and sell it today you would earn a total of 654.00 from holding Teradyne or generate 6.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ebang International Holdings vs. Teradyne
Performance |
| Timeline |
| Ebang International |
| Teradyne |
Ebang International and Teradyne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ebang International and Teradyne
The main advantage of trading using opposite Ebang International and Teradyne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ebang International position performs unexpectedly, Teradyne 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 Teradyne will offset losses from the drop in Teradyne's long position.| Ebang International vs. Nano Dimension | Ebang International vs. Desktop Metal | Ebang International vs. HP Inc | Ebang International vs. Cricut Inc |
| Teradyne vs. IPG Photonics | Teradyne vs. Ultra Clean Holdings | Teradyne vs. Onto Innovation | Teradyne vs. Cohu Inc |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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