Correlation Between Yuexiu Transport and Westinghouse Air
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Westinghouse Air 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 Westinghouse Air 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 Westinghouse Air Brake, you can compare the effects of market volatilities on Yuexiu Transport and Westinghouse Air 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 Westinghouse Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Westinghouse Air.
Diversification Opportunities for Yuexiu Transport and Westinghouse Air
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yuexiu and Westinghouse is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Westinghouse Air Brake in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westinghouse Air Brake 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 Westinghouse Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westinghouse Air Brake has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Westinghouse Air go up and down completely randomly.
Pair Corralation between Yuexiu Transport and Westinghouse Air
If you would invest 19,884 in Westinghouse Air Brake on September 14, 2024 and sell it today you would earn a total of 313.00 from holding Westinghouse Air Brake or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuexiu Transport Infrastructur vs. Westinghouse Air Brake
Performance |
| Timeline |
| Yuexiu Transport Inf |
| Westinghouse Air Brake |
Yuexiu Transport and Westinghouse Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuexiu Transport and Westinghouse Air
The main advantage of trading using opposite Yuexiu Transport and Westinghouse Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport position performs unexpectedly, Westinghouse Air 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 Westinghouse Air will offset losses from the drop in Westinghouse Air'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 |
| Westinghouse Air vs. Greenbrier Companies | Westinghouse Air vs. LB Foster | Westinghouse Air vs. Freightcar America | Westinghouse Air vs. CSX Corporation |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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