Correlation Between YeSUN Tech and Nh Investment

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

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

Diversification Opportunities for YeSUN Tech and Nh Investment

-0.42

Correlation Coefficient

YeSUN Tech  Nh Investment

Very good diversification

The 3 months correlation between YeSUN and 005945 is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding YeSUN Tech CoLtd and Nh Investment And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nh Investment And and YeSUN 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 YeSUN Tech CoLtd are associated (or correlated) with Nh Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nh Investment And has no effect on the direction of YeSUN Tech i.e., YeSUN Tech and Nh Investment go up and down completely randomly.

Pair Corralation between YeSUN Tech and Nh Investment

Assuming the 90 days trading horizon YeSUN Tech CoLtd is expected to under-perform the Nh Investment. In addition to that, YeSUN Tech is 4.66 times more volatile than Nh Investment And. It trades about -0.18 of its total potential returns per unit of risk. Nh Investment And is currently generating about 0.06 per unit of volatility. If you would invest  1,180,000  in Nh Investment And on September 12, 2024 and sell it today you would earn a total of  30,000  from holding Nh Investment And or generate 2.54% return on investment over 90 days.

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

YeSUN Tech CoLtd  vs.  Nh Investment And

YeSUN Tech CoLtd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days YeSUN Tech CoLtd 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 January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Nh Investment And

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nh Investment And are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Nh Investment is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with YeSUN Tech and Nh Investment

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

The idea behind YeSUN Tech CoLtd and Nh Investment And 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.