Correlation Between InBody CoLtd and INtRON Biotechnology
Can any of the company-specific risk be diversified away by investing in both InBody CoLtd and INtRON Biotechnology 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 InBody CoLtd and INtRON Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InBody CoLtd and iNtRON Biotechnology, you can compare the effects of market volatilities on InBody CoLtd and INtRON Biotechnology 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 InBody CoLtd with a short position of INtRON Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of InBody CoLtd and INtRON Biotechnology.
Diversification Opportunities for InBody CoLtd and INtRON Biotechnology
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between InBody and INtRON is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding InBody CoLtd and iNtRON Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iNtRON Biotechnology and InBody CoLtd 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 InBody CoLtd are associated (or correlated) with INtRON Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iNtRON Biotechnology has no effect on the direction of InBody CoLtd i.e., InBody CoLtd and INtRON Biotechnology go up and down completely randomly.
Pair Corralation between InBody CoLtd and INtRON Biotechnology
Assuming the 90 days trading horizon InBody CoLtd is expected to generate 1.03 times more return on investment than INtRON Biotechnology. However, InBody CoLtd is 1.03 times more volatile than iNtRON Biotechnology. It trades about 0.15 of its potential returns per unit of risk. iNtRON Biotechnology is currently generating about -0.02 per unit of risk. If you would invest 2,320,000 in InBody CoLtd on October 29, 2024 and sell it today you would earn a total of 120,000 from holding InBody CoLtd or generate 5.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
InBody CoLtd vs. iNtRON Biotechnology
Performance |
| Timeline |
| InBody CoLtd |
| iNtRON Biotechnology |
InBody CoLtd and INtRON Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InBody CoLtd and INtRON Biotechnology
The main advantage of trading using opposite InBody CoLtd and INtRON Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InBody CoLtd position performs unexpectedly, INtRON Biotechnology 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 INtRON Biotechnology will offset losses from the drop in INtRON Biotechnology's long position.| InBody CoLtd vs. Vieworks Co | InBody CoLtd vs. Genie Music | InBody CoLtd vs. Seegene | InBody CoLtd vs. Medy Tox |
| INtRON Biotechnology vs. Medy Tox | INtRON Biotechnology vs. Oscotec | INtRON Biotechnology vs. Genexine | INtRON Biotechnology vs. Helixmith Co |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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