Correlation Between Eshallgo and Ameriguard Security

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

By analyzing existing cross correlation between Eshallgo Class A and Ameriguard Security Services, you can compare the effects of market volatilities on Eshallgo and Ameriguard Security 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 Eshallgo with a short position of Ameriguard Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eshallgo and Ameriguard Security.

Diversification Opportunities for Eshallgo and Ameriguard Security

-0.59

Correlation Coefficient

Eshallgo  Ameriguard Security

Excellent diversification

The 3 months correlation between Eshallgo and Ameriguard is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Eshallgo Class A and Ameriguard Security Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriguard Security and Eshallgo 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 Eshallgo Class A are associated (or correlated) with Ameriguard Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriguard Security has no effect on the direction of Eshallgo i.e., Eshallgo and Ameriguard Security go up and down completely randomly.

Pair Corralation between Eshallgo and Ameriguard Security

Given the investment horizon of 90 days Eshallgo Class A is expected to generate 5.36 times more return on investment than Ameriguard Security. However, Eshallgo is 5.36 times more volatile than Ameriguard Security Services. It trades about 0.09 of its potential returns per unit of risk. Ameriguard Security Services is currently generating about 0.03 per unit of risk. If you would invest  0.00  in Eshallgo Class A on October 11, 2024 and sell it today you would earn a total of  350.00  from holding Eshallgo Class A or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	46.34%
Values	Daily Returns

Eshallgo Class A  vs.  Ameriguard Security Services

Eshallgo Class A

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eshallgo Class A are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Eshallgo displayed solid returns over the last few months and may actually be approaching a breakup point.

Ameriguard Security

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ameriguard Security Services are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Ameriguard Security unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eshallgo and Ameriguard Security

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

The idea behind Eshallgo Class A and Ameriguard Security Services 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.