Correlation Between Winner Group and Eureka Design
Can any of the company-specific risk be diversified away by investing in both Winner Group and Eureka Design 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 Winner Group and Eureka Design into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Winner Group Enterprise and Eureka Design Public, you can compare the effects of market volatilities on Winner Group and Eureka Design 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 Winner Group with a short position of Eureka Design. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winner Group and Eureka Design.
Diversification Opportunities for Winner Group and Eureka Design
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Winner and Eureka is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Winner Group Enterprise and Eureka Design Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eureka Design Public and Winner Group 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 Winner Group Enterprise are associated (or correlated) with Eureka Design. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eureka Design Public has no effect on the direction of Winner Group i.e., Winner Group and Eureka Design go up and down completely randomly.
Pair Corralation between Winner Group and Eureka Design
Assuming the 90 days trading horizon Winner Group is expected to generate 72.14 times less return on investment than Eureka Design. But when comparing it to its historical volatility, Winner Group Enterprise is 2.77 times less risky than Eureka Design. It trades about 0.0 of its potential returns per unit of risk. Eureka Design Public is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 49.00 in Eureka Design Public on August 26, 2024 and sell it today you would earn a total of 3.00 from holding Eureka Design Public or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Winner Group Enterprise vs. Eureka Design Public
Performance |
| Timeline |
| Winner Group Enterprise |
| Eureka Design Public |
Winner Group and Eureka Design Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winner Group and Eureka Design
The main advantage of trading using opposite Winner Group and Eureka Design positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winner Group position performs unexpectedly, Eureka Design 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 Eureka Design will offset losses from the drop in Eureka Design's long position.| Winner Group vs. Chamni Eye PCL | Winner Group vs. Siam Global House | Winner Group vs. The Erawan Group | Winner Group vs. Ditto Public |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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