Correlation Between Yuexiu Transport and Jutal Offshore

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

Diversification Opportunities for Yuexiu Transport and Jutal Offshore

1.0

Correlation Coefficient

Yuexiu Transport  Jutal Offshore

No risk reduction

The 3 months correlation between Yuexiu and Jutal is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Jutal Offshore Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jutal Offshore Oil 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 Jutal Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jutal Offshore Oil has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Jutal Offshore go up and down completely randomly.

Pair Corralation between Yuexiu Transport and Jutal Offshore

If you would invest  2,081  in Jutal Offshore Oil on December 28, 2024 and sell it today you would earn a total of  0.00  from holding Jutal Offshore Oil or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	95.24%
Values	Daily Returns

Yuexiu Transport Infrastructur  vs.  Jutal Offshore Oil

Yuexiu Transport Inf

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yuexiu Transport Infrastructure has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Yuexiu Transport is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Jutal Offshore Oil

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Yuexiu Transport and Jutal Offshore

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

The idea behind Yuexiu Transport Infrastructure and Jutal Offshore Oil 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.