Correlation Between Innovative Medical and Sinofibers Technology
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By analyzing existing cross correlation between Innovative Medical Management and Sinofibers Technology Co, you can compare the effects of market volatilities on Innovative Medical and Sinofibers Technology 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 Innovative Medical with a short position of Sinofibers Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Medical and Sinofibers Technology.
Diversification Opportunities for Innovative Medical and Sinofibers Technology
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Innovative and Sinofibers is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Medical Management and Sinofibers Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinofibers Technology and Innovative Medical 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 Innovative Medical Management are associated (or correlated) with Sinofibers Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinofibers Technology has no effect on the direction of Innovative Medical i.e., Innovative Medical and Sinofibers Technology go up and down completely randomly.
Pair Corralation between Innovative Medical and Sinofibers Technology
Assuming the 90 days trading horizon Innovative Medical Management is expected to generate 0.88 times more return on investment than Sinofibers Technology. However, Innovative Medical Management is 1.14 times less risky than Sinofibers Technology. It trades about 0.16 of its potential returns per unit of risk. Sinofibers Technology Co is currently generating about 0.12 per unit of risk. If you would invest 624.00 in Innovative Medical Management on August 30, 2024 and sell it today you would earn a total of 247.00 from holding Innovative Medical Management or generate 39.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovative Medical Management vs. Sinofibers Technology Co
Performance |
| Timeline |
| Innovative Medical |
| Sinofibers Technology |
Innovative Medical and Sinofibers Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Medical and Sinofibers Technology
The main advantage of trading using opposite Innovative Medical and Sinofibers Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Medical position performs unexpectedly, Sinofibers Technology 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 Sinofibers Technology will offset losses from the drop in Sinofibers Technology's long position.| Innovative Medical vs. PetroChina Co Ltd | Innovative Medical vs. China Mobile Limited | Innovative Medical vs. Ping An Insurance | Innovative Medical vs. China Petroleum Chemical |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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