Correlation Between Yuexiu Transport and Royalty Management
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Royalty Management 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 Royalty Management 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 Royalty Management Holding, you can compare the effects of market volatilities on Yuexiu Transport and Royalty Management 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 Royalty Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Royalty Management.
Diversification Opportunities for Yuexiu Transport and Royalty Management
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yuexiu and Royalty is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Royalty Management Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Royalty Management 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 Royalty Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Royalty Management has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Royalty Management go up and down completely randomly.
Pair Corralation between Yuexiu Transport and Royalty Management
Assuming the 90 days horizon Yuexiu Transport Infrastructure is expected to generate 0.43 times more return on investment than Royalty Management. However, Yuexiu Transport Infrastructure is 2.35 times less risky than Royalty Management. It trades about 0.1 of its potential returns per unit of risk. Royalty Management Holding is currently generating about -0.01 per unit of risk. If you would invest 45.00 in Yuexiu Transport Infrastructure on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Yuexiu Transport Infrastructure or generate 28.89% 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. Royalty Management Holding
Performance |
| Timeline |
| Yuexiu Transport Inf |
| Royalty Management |
Yuexiu Transport and Royalty Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuexiu Transport and Royalty Management
The main advantage of trading using opposite Yuexiu Transport and Royalty Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport position performs unexpectedly, Royalty Management 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 Royalty Management will offset losses from the drop in Royalty Management's long position.| Yuexiu Transport vs. Zhejiang Expressway Co | Yuexiu Transport vs. Jiangsu Expressway Co | Yuexiu Transport vs. Jiangsu Expressway | Yuexiu Transport vs. Verra Mobility Corp |
| Royalty Management vs. CapitaLand Investment Limited | Royalty Management vs. PennantPark Investment | Royalty Management vs. Radcom | Royalty Management vs. Weibo Corp |
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 Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |