Correlation Between Yuan High and Amulaire Thermal

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

By analyzing existing cross correlation between Yuan High Tech Development and Amulaire Thermal Technology, you can compare the effects of market volatilities on Yuan High and Amulaire Thermal 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 Yuan High with a short position of Amulaire Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan High and Amulaire Thermal.

Diversification Opportunities for Yuan High and Amulaire Thermal

0.4

Correlation Coefficient

Yuan High  Amulaire Thermal

Very weak diversification

The 3 months correlation between Yuan and Amulaire is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Yuan High Tech Development and Amulaire Thermal Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amulaire Thermal Tec and Yuan High 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 Yuan High Tech Development are associated (or correlated) with Amulaire Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amulaire Thermal Tec has no effect on the direction of Yuan High i.e., Yuan High and Amulaire Thermal go up and down completely randomly.

Pair Corralation between Yuan High and Amulaire Thermal

Assuming the 90 days trading horizon Yuan High Tech Development is expected to under-perform the Amulaire Thermal. In addition to that, Yuan High is 1.51 times more volatile than Amulaire Thermal Technology. It trades about -0.07 of its total potential returns per unit of risk. Amulaire Thermal Technology is currently generating about 0.08 per unit of volatility. If you would invest  2,810  in Amulaire Thermal Technology on December 28, 2024 and sell it today you would earn a total of  265.00  from holding Amulaire Thermal Technology or generate 9.43% return on investment over 90 days.

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

Yuan High Tech Development  vs.  Amulaire Thermal Technology

Yuan High Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yuan High Tech Development has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Amulaire Thermal Tec

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Amulaire Thermal Technology are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Amulaire Thermal may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Yuan High and Amulaire Thermal

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

The idea behind Yuan High Tech Development and Amulaire Thermal Technology 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.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.