Correlation Between Yuexiu Transport and HAVILA SHIPPING

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

By analyzing existing cross correlation between Yuexiu Transport Infrastructure and HAVILA SHIPPING, you can compare the effects of market volatilities on Yuexiu Transport and HAVILA SHIPPING 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 Yuexiu Transport with a short position of HAVILA SHIPPING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and HAVILA SHIPPING.

Diversification Opportunities for Yuexiu Transport and HAVILA SHIPPING

-0.87

Correlation Coefficient

Yuexiu Transport  HAVILA SHIPPING

Pay attention - limited upside

The 3 months correlation between Yuexiu and HAVILA is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and HAVILA SHIPPING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAVILA SHIPPING and Yuexiu Transport 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 Yuexiu Transport Infrastructure are associated (or correlated) with HAVILA SHIPPING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAVILA SHIPPING has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and HAVILA SHIPPING go up and down completely randomly.

Pair Corralation between Yuexiu Transport and HAVILA SHIPPING

Assuming the 90 days horizon Yuexiu Transport Infrastructure is expected to generate 0.84 times more return on investment than HAVILA SHIPPING. However, Yuexiu Transport Infrastructure is 1.2 times less risky than HAVILA SHIPPING. It trades about 0.08 of its potential returns per unit of risk. HAVILA SHIPPING is currently generating about -0.07 per unit of risk. If you would invest  14.00  in Yuexiu Transport Infrastructure on October 10, 2024 and sell it today you would earn a total of  33.00  from holding Yuexiu Transport Infrastructure or generate 235.71% return on investment over 90 days.

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

Yuexiu Transport Infrastructur  vs.  HAVILA SHIPPING

Yuexiu Transport Inf

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Yuexiu Transport Infrastructure are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Yuexiu Transport reported solid returns over the last few months and may actually be approaching a breakup point.

HAVILA SHIPPING

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HAVILA SHIPPING has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Yuexiu Transport and HAVILA SHIPPING

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

The idea behind Yuexiu Transport Infrastructure and HAVILA SHIPPING 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.