Correlation Between Yang Ming and Jetway Information

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

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

Diversification Opportunities for Yang Ming and Jetway Information

0.7

Correlation Coefficient

Yang Ming  Jetway Information

Poor diversification

The 3 months correlation between Yang and Jetway is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Yang Ming Marine and Jetway Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jetway Information and Yang Ming 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 Yang Ming Marine are associated (or correlated) with Jetway Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jetway Information has no effect on the direction of Yang Ming i.e., Yang Ming and Jetway Information go up and down completely randomly.

Pair Corralation between Yang Ming and Jetway Information

Assuming the 90 days trading horizon Yang Ming Marine is expected to under-perform the Jetway Information. But the stock apears to be less risky and, when comparing its historical volatility, Yang Ming Marine is 1.13 times less risky than Jetway Information. The stock trades about -0.02 of its potential returns per unit of risk. The Jetway Information Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  4,965  in Jetway Information Co on December 21, 2024 and sell it today you would earn a total of  265.00  from holding Jetway Information Co or generate 5.34% return on investment over 90 days.

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

Yang Ming Marine  vs.  Jetway Information Co

Yang Ming Marine

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yang Ming Marine has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Yang Ming is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Jetway Information

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jetway Information Co are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Jetway Information may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Yang Ming and Jetway Information

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

The idea behind Yang Ming Marine and Jetway Information Co 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.