Correlation Between Eshallgo and Amphenol
Can any of the company-specific risk be diversified away by investing in both Eshallgo and Amphenol 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 Eshallgo and Amphenol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eshallgo Class A and Amphenol, you can compare the effects of market volatilities on Eshallgo and Amphenol 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 Eshallgo with a short position of Amphenol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eshallgo and Amphenol.
Diversification Opportunities for Eshallgo and Amphenol
Very poor diversification
The 3 months correlation between Eshallgo and Amphenol is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Eshallgo Class A and Amphenol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amphenol and Eshallgo 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 Eshallgo Class A are associated (or correlated) with Amphenol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amphenol has no effect on the direction of Eshallgo i.e., Eshallgo and Amphenol go up and down completely randomly.
Pair Corralation between Eshallgo and Amphenol
Given the investment horizon of 90 days Eshallgo Class A is expected to generate 4.81 times more return on investment than Amphenol. However, Eshallgo is 4.81 times more volatile than Amphenol. It trades about 0.23 of its potential returns per unit of risk. Amphenol is currently generating about 0.18 per unit of risk. If you would invest 208.00 in Eshallgo Class A on August 30, 2024 and sell it today you would earn a total of 192.00 from holding Eshallgo Class A or generate 92.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.73% |
| Values | Daily Returns |
Eshallgo Class A vs. Amphenol
Performance |
| Timeline |
| Eshallgo Class A |
| Amphenol |
Eshallgo and Amphenol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eshallgo and Amphenol
The main advantage of trading using opposite Eshallgo and Amphenol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eshallgo position performs unexpectedly, Amphenol 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 Amphenol will offset losses from the drop in Amphenol's long position.| Eshallgo vs. Fabrinet | Eshallgo vs. Knowles Cor | Eshallgo vs. Ubiquiti Networks | Eshallgo vs. AmpliTech Group |
| Amphenol vs. Fabrinet | Amphenol vs. Knowles Cor | Amphenol vs. Ubiquiti Networks | Amphenol vs. AmpliTech Group |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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