Correlation Between TJ Media and GeneBioTech
Can any of the company-specific risk be diversified away by investing in both TJ Media and GeneBioTech 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 TJ Media and GeneBioTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TJ media Co and GeneBioTech Co, you can compare the effects of market volatilities on TJ Media and GeneBioTech 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 TJ Media with a short position of GeneBioTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of TJ Media and GeneBioTech.
Diversification Opportunities for TJ Media and GeneBioTech
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 032540 and GeneBioTech is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding TJ media Co and GeneBioTech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GeneBioTech and TJ Media 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 TJ media Co are associated (or correlated) with GeneBioTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GeneBioTech has no effect on the direction of TJ Media i.e., TJ Media and GeneBioTech go up and down completely randomly.
Pair Corralation between TJ Media and GeneBioTech
Assuming the 90 days trading horizon TJ media Co is expected to under-perform the GeneBioTech. But the stock apears to be less risky and, when comparing its historical volatility, TJ media Co is 1.09 times less risky than GeneBioTech. The stock trades about -0.02 of its potential returns per unit of risk. The GeneBioTech Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 415,000 in GeneBioTech Co on October 13, 2024 and sell it today you would lose (66,500) from holding GeneBioTech Co or give up 16.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TJ media Co vs. GeneBioTech Co
Performance |
| Timeline |
| TJ media |
| GeneBioTech |
TJ Media and GeneBioTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TJ Media and GeneBioTech
The main advantage of trading using opposite TJ Media and GeneBioTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TJ Media position performs unexpectedly, GeneBioTech 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 GeneBioTech will offset losses from the drop in GeneBioTech's long position.| TJ Media vs. Samhyun Steel Co | TJ Media vs. Daechang Steel Co | TJ Media vs. Samyoung Electronics Co | TJ Media vs. J Steel Co |
| GeneBioTech vs. MEDIANA CoLtd | GeneBioTech vs. ChipsMedia | GeneBioTech vs. TJ media Co | GeneBioTech vs. CKH Food Health |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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