Correlation Between Green Street and Yuexiu Transport

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

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

Diversification Opportunities for Green Street and Yuexiu Transport

-1.0

Correlation Coefficient

Green Street  Yuexiu Transport

Pay attention - limited upside

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

Pair Corralation between Green Street and Yuexiu Transport

If you would invest  58.00  in Yuexiu Transport Infrastructure on December 28, 2024 and sell it today you would earn a total of  0.00  from holding Yuexiu Transport Infrastructure or generate 0.0% return on investment over 90 days.

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

Green Street Capital  vs.  Yuexiu Transport Infrastructur

Green Street Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Green Street Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Green Street is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

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.

Pair Trading with Green Street and Yuexiu Transport

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

The idea behind Green Street Capital and Yuexiu Transport Infrastructure 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.