Correlation Between Expeditors International and DAIRY FARM
Can any of the company-specific risk be diversified away by investing in both Expeditors International and DAIRY FARM 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 Expeditors International and DAIRY FARM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expeditors International of and DAIRY FARM INTL, you can compare the effects of market volatilities on Expeditors International and DAIRY FARM 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 Expeditors International with a short position of DAIRY FARM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expeditors International and DAIRY FARM.
Diversification Opportunities for Expeditors International and DAIRY FARM
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Expeditors and DAIRY is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Expeditors International of and DAIRY FARM INTL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAIRY FARM INTL and Expeditors 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 Expeditors International of are associated (or correlated) with DAIRY FARM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAIRY FARM INTL has no effect on the direction of Expeditors International i.e., Expeditors International and DAIRY FARM go up and down completely randomly.
Pair Corralation between Expeditors International and DAIRY FARM
Assuming the 90 days horizon Expeditors International of is expected to generate 0.48 times more return on investment than DAIRY FARM. However, Expeditors International of is 2.06 times less risky than DAIRY FARM. It trades about 0.06 of its potential returns per unit of risk. DAIRY FARM INTL is currently generating about -0.06 per unit of risk. If you would invest 11,088 in Expeditors International of on September 15, 2024 and sell it today you would earn a total of 137.00 from holding Expeditors International of or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Expeditors International of vs. DAIRY FARM INTL
Performance |
| Timeline |
| Expeditors International |
| DAIRY FARM INTL |
Expeditors International and DAIRY FARM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expeditors International and DAIRY FARM
The main advantage of trading using opposite Expeditors International and DAIRY FARM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expeditors International position performs unexpectedly, DAIRY FARM 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 DAIRY FARM will offset losses from the drop in DAIRY FARM's long position.| Expeditors International vs. DAIRY FARM INTL | Expeditors International vs. TOREX SEMICONDUCTOR LTD | Expeditors International vs. Daito Trust Construction | Expeditors International vs. Sterling Construction |
| DAIRY FARM vs. SBI Insurance Group | DAIRY FARM vs. Zijin Mining Group | DAIRY FARM vs. MINCO SILVER | DAIRY FARM vs. REVO INSURANCE SPA |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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