Correlation Between Yong Concrete and International Network
Can any of the company-specific risk be diversified away by investing in both Yong Concrete and International Network 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 Yong Concrete and International Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yong Concrete PCL and International Network System, you can compare the effects of market volatilities on Yong Concrete and International Network 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 Yong Concrete with a short position of International Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yong Concrete and International Network.
Diversification Opportunities for Yong Concrete and International Network
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yong and International is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Yong Concrete PCL and International Network System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Network and Yong Concrete 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 Yong Concrete PCL are associated (or correlated) with International Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Network has no effect on the direction of Yong Concrete i.e., Yong Concrete and International Network go up and down completely randomly.
Pair Corralation between Yong Concrete and International Network
Assuming the 90 days trading horizon Yong Concrete PCL is expected to generate 0.5 times more return on investment than International Network. However, Yong Concrete PCL is 2.02 times less risky than International Network. It trades about -0.27 of its potential returns per unit of risk. International Network System is currently generating about -0.24 per unit of risk. If you would invest 108.00 in Yong Concrete PCL on October 23, 2024 and sell it today you would lose (6.00) from holding Yong Concrete PCL or give up 5.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yong Concrete PCL vs. International Network System
Performance |
| Timeline |
| Yong Concrete PCL |
| International Network |
Yong Concrete and International Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yong Concrete and International Network
The main advantage of trading using opposite Yong Concrete and International Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yong Concrete position performs unexpectedly, International Network 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 International Network will offset losses from the drop in International Network's long position.| Yong Concrete vs. Exotic Food Public | Yong Concrete vs. Knight Club Capital | Yong Concrete vs. North East Rubbers | Yong Concrete vs. Yggdrazil Group Public |
| International Network vs. Yong Concrete PCL | International Network vs. Yggdrazil Group Public | International Network vs. Exotic Food Public | International Network vs. North East Rubbers |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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