Correlation Between Teradyne and Eshallgo
Can any of the company-specific risk be diversified away by investing in both Teradyne and Eshallgo 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 Teradyne and Eshallgo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradyne and Eshallgo Class A, you can compare the effects of market volatilities on Teradyne and Eshallgo 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 Teradyne with a short position of Eshallgo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradyne and Eshallgo.
Diversification Opportunities for Teradyne and Eshallgo
Pay attention - limited upside
The 3 months correlation between Teradyne and Eshallgo is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Teradyne and Eshallgo Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eshallgo Class A and Teradyne 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 Teradyne are associated (or correlated) with Eshallgo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eshallgo Class A has no effect on the direction of Teradyne i.e., Teradyne and Eshallgo go up and down completely randomly.
Pair Corralation between Teradyne and Eshallgo
Considering the 90-day investment horizon Teradyne is expected to generate 1.49 times less return on investment than Eshallgo. But when comparing it to its historical volatility, Teradyne is 3.91 times less risky than Eshallgo. It trades about 0.09 of its potential returns per unit of risk. Eshallgo Class A is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 365.00 in Eshallgo Class A on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Eshallgo Class A or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teradyne vs. Eshallgo Class A
Performance |
| Timeline |
| Teradyne |
| Eshallgo Class A |
Teradyne and Eshallgo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teradyne and Eshallgo
The main advantage of trading using opposite Teradyne and Eshallgo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradyne position performs unexpectedly, Eshallgo 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 Eshallgo will offset losses from the drop in Eshallgo's long position.| Teradyne vs. IPG Photonics | Teradyne vs. Ultra Clean Holdings | Teradyne vs. Onto Innovation | Teradyne vs. Cohu Inc |
| Eshallgo vs. Knowles Cor | Eshallgo vs. Ubiquiti Networks | Eshallgo vs. AmpliTech Group | Eshallgo vs. Viavi Solutions |
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.
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