Correlation Between Kee Tai and Evergreen International
Can any of the company-specific risk be diversified away by investing in both Kee Tai and Evergreen International 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 Kee Tai and Evergreen International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kee Tai Properties and Evergreen International Storage, you can compare the effects of market volatilities on Kee Tai and Evergreen International 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 Kee Tai with a short position of Evergreen International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kee Tai and Evergreen International.
Diversification Opportunities for Kee Tai and Evergreen International
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kee and Evergreen is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kee Tai Properties and Evergreen International Storag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evergreen International and Kee Tai 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 Kee Tai Properties are associated (or correlated) with Evergreen International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evergreen International has no effect on the direction of Kee Tai i.e., Kee Tai and Evergreen International go up and down completely randomly.
Pair Corralation between Kee Tai and Evergreen International
Assuming the 90 days trading horizon Kee Tai Properties is expected to under-perform the Evergreen International. In addition to that, Kee Tai is 1.38 times more volatile than Evergreen International Storage. It trades about -0.13 of its total potential returns per unit of risk. Evergreen International Storage is currently generating about 0.08 per unit of volatility. If you would invest 2,955 in Evergreen International Storage on September 5, 2024 and sell it today you would earn a total of 140.00 from holding Evergreen International Storage or generate 4.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Kee Tai Properties vs. Evergreen International Storag
Performance |
Timeline |
Kee Tai Properties |
Evergreen International |
Kee Tai and Evergreen International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kee Tai and Evergreen International
The main advantage of trading using opposite Kee Tai and Evergreen International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kee Tai position performs unexpectedly, Evergreen International 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 Evergreen International will offset losses from the drop in Evergreen International's long position.Kee Tai vs. Ruentex Development Co | Kee Tai vs. Taiwan Cement Corp | Kee Tai vs. Symtek Automation Asia | Kee Tai vs. CTCI Corp |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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