Correlation Between YanGuFang International and Smart For

Can any of the company-specific risk be diversified away by investing in both YanGuFang International and Smart For 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 YanGuFang International and Smart For into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between YanGuFang International Group and Smart for Life,, you can compare the effects of market volatilities on YanGuFang International and Smart For 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 YanGuFang International with a short position of Smart For. Check out your portfolio center. Please also check ongoing floating volatility patterns of YanGuFang International and Smart For.

Diversification Opportunities for YanGuFang International and Smart For

0.0

Correlation Coefficient

YanGuFang International  Smart For

Pay attention - limited upside

The 3 months correlation between YanGuFang and Smart is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding YanGuFang International Group and Smart for Life, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smart for Life, and YanGuFang International 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 YanGuFang International Group are associated (or correlated) with Smart For. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smart for Life, has no effect on the direction of YanGuFang International i.e., YanGuFang International and Smart For go up and down completely randomly.

Pair Corralation between YanGuFang International and Smart For

If you would invest (100.00) in Smart for Life, on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Smart for Life, or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

YanGuFang International Group  vs.  Smart for Life,

YanGuFang International

Risk-Adjusted Performance

Very Weak

Over the last 90 days YanGuFang International Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, YanGuFang International is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Smart for Life,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Smart for Life, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Smart For is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with YanGuFang International and Smart For

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

The idea behind YanGuFang International Group and Smart for Life, 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.