Correlation Between Easyhome New and Agricultural Bank

Can any of the company-specific risk be diversified away by investing in both Easyhome New and Agricultural Bank 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 Easyhome New and Agricultural Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Easyhome New Retail and Agricultural Bank of, you can compare the effects of market volatilities on Easyhome New and Agricultural Bank 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 Easyhome New with a short position of Agricultural Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easyhome New and Agricultural Bank.

Diversification Opportunities for Easyhome New and Agricultural Bank

0.27

Correlation Coefficient

Easyhome New  Agricultural Bank

Modest diversification

The 3 months correlation between Easyhome and Agricultural is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Easyhome New Retail and Agricultural Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agricultural Bank and Easyhome New 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 Easyhome New Retail are associated (or correlated) with Agricultural Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agricultural Bank has no effect on the direction of Easyhome New i.e., Easyhome New and Agricultural Bank go up and down completely randomly.

Pair Corralation between Easyhome New and Agricultural Bank

Assuming the 90 days trading horizon Easyhome New Retail is expected to generate 4.36 times more return on investment than Agricultural Bank. However, Easyhome New is 4.36 times more volatile than Agricultural Bank of. It trades about 0.07 of its potential returns per unit of risk. Agricultural Bank of is currently generating about -0.07 per unit of risk. If you would invest  373.00  in Easyhome New Retail on December 29, 2024 and sell it today you would earn a total of  55.00  from holding Easyhome New Retail or generate 14.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Easyhome New Retail  vs.  Agricultural Bank of

Easyhome New Retail

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Easyhome New Retail are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Easyhome New sustained solid returns over the last few months and may actually be approaching a breakup point.

Agricultural Bank

Risk-Adjusted Performance

Very Weak

Over the last 90 days Agricultural Bank of has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Agricultural Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Easyhome New and Agricultural Bank

The main advantage of trading using opposite Easyhome New and Agricultural Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easyhome New position performs unexpectedly, Agricultural Bank 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 Agricultural Bank will offset losses from the drop in Agricultural Bank's long position.

The idea behind Easyhome New Retail and Agricultural Bank of pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.