Correlation Between Yuexiu Transport and Sterling Construction
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Sterling Construction 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 Yuexiu Transport and Sterling Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuexiu Transport Infrastructure and Sterling Construction, you can compare the effects of market volatilities on Yuexiu Transport and Sterling Construction 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 Yuexiu Transport with a short position of Sterling Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Sterling Construction.
Diversification Opportunities for Yuexiu Transport and Sterling Construction
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yuexiu and Sterling is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Sterling Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Construction and Yuexiu Transport 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 Yuexiu Transport Infrastructure are associated (or correlated) with Sterling Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Construction has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Sterling Construction go up and down completely randomly.
Pair Corralation between Yuexiu Transport and Sterling Construction
Assuming the 90 days horizon Yuexiu Transport Infrastructure is expected to under-perform the Sterling Construction. But the stock apears to be less risky and, when comparing its historical volatility, Yuexiu Transport Infrastructure is 1.48 times less risky than Sterling Construction. The stock trades about -0.14 of its potential returns per unit of risk. The Sterling Construction is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 16,435 in Sterling Construction on October 25, 2024 and sell it today you would earn a total of 2,775 from holding Sterling Construction or generate 16.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuexiu Transport Infrastructur vs. Sterling Construction
Performance |
| Timeline |
| Yuexiu Transport Inf |
| Sterling Construction |
Yuexiu Transport and Sterling Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuexiu Transport and Sterling Construction
The main advantage of trading using opposite Yuexiu Transport and Sterling Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport position performs unexpectedly, Sterling Construction 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 Sterling Construction will offset losses from the drop in Sterling Construction's long position.| Yuexiu Transport vs. Universal Health Realty | Yuexiu Transport vs. Phibro Animal Health | Yuexiu Transport vs. CLOVER HEALTH INV | Yuexiu Transport vs. MPH Health Care |
| Sterling Construction vs. GREENX METALS LTD | Sterling Construction vs. Scientific Games | Sterling Construction vs. Boyd Gaming | Sterling Construction vs. Yuexiu Transport Infrastructure |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Stocks Directory Find actively traded stocks across global markets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |