Correlation Between Eshallgo and Toppan Printing

Can any of the company-specific risk be diversified away by investing in both Eshallgo and Toppan Printing 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 Toppan Printing 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 Toppan Printing, you can compare the effects of market volatilities on Eshallgo and Toppan Printing 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 Toppan Printing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eshallgo and Toppan Printing.

Diversification Opportunities for Eshallgo and Toppan Printing

-0.45

Correlation Coefficient

Eshallgo  Toppan Printing

Very good diversification

The 3 months correlation between Eshallgo and Toppan is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Eshallgo Class A and Toppan Printing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toppan Printing 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 Toppan Printing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toppan Printing has no effect on the direction of Eshallgo i.e., Eshallgo and Toppan Printing go up and down completely randomly.

Pair Corralation between Eshallgo and Toppan Printing

Given the investment horizon of 90 days Eshallgo Class A is expected to under-perform the Toppan Printing. In addition to that, Eshallgo is 1.63 times more volatile than Toppan Printing. It trades about -0.03 of its total potential returns per unit of risk. Toppan Printing is currently generating about 0.07 per unit of volatility. If you would invest  1,266  in Toppan Printing on October 10, 2024 and sell it today you would earn a total of  60.00  from holding Toppan Printing or generate 4.74% return on investment over 90 days.

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

Eshallgo Class A  vs.  Toppan Printing

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.

Toppan Printing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Toppan Printing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Toppan Printing is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Eshallgo and Toppan Printing

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

The idea behind Eshallgo Class A and Toppan Printing 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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..