Correlation Between Evergreen Marine and P Duke
Can any of the company-specific risk be diversified away by investing in both Evergreen Marine and P Duke 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 Evergreen Marine and P Duke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evergreen Marine Corp and P Duke Technology Co, you can compare the effects of market volatilities on Evergreen Marine and P Duke 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 Evergreen Marine with a short position of P Duke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evergreen Marine and P Duke.
Diversification Opportunities for Evergreen Marine and P Duke
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Evergreen and 8109 is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Evergreen Marine Corp and P Duke Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on P Duke Technology and Evergreen Marine 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 Evergreen Marine Corp are associated (or correlated) with P Duke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of P Duke Technology has no effect on the direction of Evergreen Marine i.e., Evergreen Marine and P Duke go up and down completely randomly.
Pair Corralation between Evergreen Marine and P Duke
Assuming the 90 days trading horizon Evergreen Marine Corp is expected to generate 5.17 times more return on investment than P Duke. However, Evergreen Marine is 5.17 times more volatile than P Duke Technology Co. It trades about 0.15 of its potential returns per unit of risk. P Duke Technology Co is currently generating about -0.08 per unit of risk. If you would invest 18,450 in Evergreen Marine Corp on September 15, 2024 and sell it today you would earn a total of 4,550 from holding Evergreen Marine Corp or generate 24.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Evergreen Marine Corp vs. P Duke Technology Co
Performance |
Timeline |
Evergreen Marine Corp |
P Duke Technology |
Evergreen Marine and P Duke Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Evergreen Marine and P Duke
The main advantage of trading using opposite Evergreen Marine and P Duke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evergreen Marine position performs unexpectedly, P Duke 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 P Duke will offset losses from the drop in P Duke's long position.Evergreen Marine vs. Wan Hai Lines | Evergreen Marine vs. U Ming Marine Transport | Evergreen Marine vs. China Airlines |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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