Correlation Between Stock Exchange and Unique Engineering
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Unique Engineering 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 Stock Exchange and Unique Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stock Exchange Of and Unique Engineering and, you can compare the effects of market volatilities on Stock Exchange and Unique Engineering 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 Stock Exchange with a short position of Unique Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Unique Engineering.
Diversification Opportunities for Stock Exchange and Unique Engineering
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stock and Unique is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Unique Engineering and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unique Engineering and and Stock Exchange 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 Stock Exchange Of are associated (or correlated) with Unique Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unique Engineering and has no effect on the direction of Stock Exchange i.e., Stock Exchange and Unique Engineering go up and down completely randomly.
Pair Corralation between Stock Exchange and Unique Engineering
Assuming the 90 days trading horizon Stock Exchange Of is expected to under-perform the Unique Engineering. But the index apears to be less risky and, when comparing its historical volatility, Stock Exchange Of is 63.93 times less risky than Unique Engineering. The index trades about -0.03 of its potential returns per unit of risk. The Unique Engineering and is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 449.00 in Unique Engineering and on September 2, 2024 and sell it today you would lose (167.00) from holding Unique Engineering and or give up 37.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. Unique Engineering and
Performance |
| Timeline |
Stock Exchange and Unique Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Unique Engineering and
Pair trading matchups for Unique Engineering
Pair Trading with Stock Exchange and Unique Engineering
The main advantage of trading using opposite Stock Exchange and Unique Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Unique Engineering 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 Unique Engineering will offset losses from the drop in Unique Engineering's long position.| Stock Exchange vs. Central Retail | Stock Exchange vs. Interlink Communication Public | Stock Exchange vs. NSL Foods Public | Stock Exchange vs. Central Plaza Hotel |
| Unique Engineering vs. CH Karnchang Public | Unique Engineering vs. Italian Thai Development Public | Unique Engineering vs. LPN Development Public | Unique Engineering vs. WHA Public |
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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