Correlation Between Eastern Commercial and EMC Public
Can any of the company-specific risk be diversified away by investing in both Eastern Commercial and EMC Public 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 Eastern Commercial and EMC Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastern Commercial Leasing and EMC Public, you can compare the effects of market volatilities on Eastern Commercial and EMC Public 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 Eastern Commercial with a short position of EMC Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Commercial and EMC Public.
Diversification Opportunities for Eastern Commercial and EMC Public
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Eastern and EMC is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Commercial Leasing and EMC Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMC Public and Eastern Commercial 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 Eastern Commercial Leasing are associated (or correlated) with EMC Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMC Public has no effect on the direction of Eastern Commercial i.e., Eastern Commercial and EMC Public go up and down completely randomly.
Pair Corralation between Eastern Commercial and EMC Public
Assuming the 90 days trading horizon Eastern Commercial Leasing is expected to under-perform the EMC Public. But the stock apears to be less risky and, when comparing its historical volatility, Eastern Commercial Leasing is 2.54 times less risky than EMC Public. The stock trades about -0.05 of its potential returns per unit of risk. The EMC Public is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 7.00 in EMC Public on December 28, 2024 and sell it today you would lose (1.00) from holding EMC Public or give up 14.29% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Eastern Commercial Leasing vs. EMC Public
Performance |
Timeline |
Eastern Commercial |
EMC Public |
Eastern Commercial and EMC Public Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eastern Commercial and EMC Public
The main advantage of trading using opposite Eastern Commercial and EMC Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Commercial position performs unexpectedly, EMC Public 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 EMC Public will offset losses from the drop in EMC Public's long position.Eastern Commercial vs. Chai Watana Tannery | Eastern Commercial vs. EMC Public | Eastern Commercial vs. Asia Plus Group | Eastern Commercial vs. Globlex Holding Management |
EMC Public vs. Italian Thai Development Public | EMC Public vs. Eastern Commercial Leasing | EMC Public vs. CH Karnchang Public | EMC Public vs. Christiani Nielsen Public |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |