Correlation Between Yura Tech and Ecoplastic

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

By analyzing existing cross correlation between Yura Tech Co and Ecoplastic, you can compare the effects of market volatilities on Yura Tech and Ecoplastic 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 Yura Tech with a short position of Ecoplastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yura Tech and Ecoplastic.

Diversification Opportunities for Yura Tech and Ecoplastic

-0.28

Correlation Coefficient

Yura Tech  Ecoplastic

Very good diversification

The 3 months correlation between Yura and Ecoplastic is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Yura Tech Co and Ecoplastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecoplastic and Yura Tech 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 Yura Tech Co are associated (or correlated) with Ecoplastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecoplastic has no effect on the direction of Yura Tech i.e., Yura Tech and Ecoplastic go up and down completely randomly.

Pair Corralation between Yura Tech and Ecoplastic

Assuming the 90 days trading horizon Yura Tech Co is expected to generate 0.95 times more return on investment than Ecoplastic. However, Yura Tech Co is 1.06 times less risky than Ecoplastic. It trades about 0.01 of its potential returns per unit of risk. Ecoplastic is currently generating about -0.09 per unit of risk. If you would invest  807,959  in Yura Tech Co on October 9, 2024 and sell it today you would lose (10,959) from holding Yura Tech Co or give up 1.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Yura Tech Co  vs.  Ecoplastic

Yura Tech

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Yura Tech Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Yura Tech sustained solid returns over the last few months and may actually be approaching a breakup point.

Ecoplastic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ecoplastic has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Yura Tech and Ecoplastic

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

The idea behind Yura Tech Co and Ecoplastic 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.

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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.