Correlation Between East West and Vista Land

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

By analyzing existing cross correlation between East West Banking and Vista Land Lifescapes, you can compare the effects of market volatilities on East West and Vista Land 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 East West with a short position of Vista Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of East West and Vista Land.

Diversification Opportunities for East West and Vista Land

0.13

Correlation Coefficient

East West  Vista Land

Average diversification

The 3 months correlation between East and Vista is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding East West Banking and Vista Land Lifescapes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vista Land Lifescapes and East West 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 East West Banking are associated (or correlated) with Vista Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vista Land Lifescapes has no effect on the direction of East West i.e., East West and Vista Land go up and down completely randomly.

Pair Corralation between East West and Vista Land

Assuming the 90 days trading horizon East West Banking is expected to generate 1.03 times more return on investment than Vista Land. However, East West is 1.03 times more volatile than Vista Land Lifescapes. It trades about 0.1 of its potential returns per unit of risk. Vista Land Lifescapes is currently generating about 0.06 per unit of risk. If you would invest  969.00  in East West Banking on December 20, 2024 and sell it today you would earn a total of  61.00  from holding East West Banking or generate 6.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	83.05%
Values	Daily Returns

East West Banking  vs.  Vista Land Lifescapes

East West Banking

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in East West Banking are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, East West may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Vista Land Lifescapes

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vista Land Lifescapes are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable essential indicators, Vista Land is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with East West and Vista Land

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

The idea behind East West Banking and Vista Land Lifescapes 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.