Correlation Between INtRON Biotechnology and COWAY
Can any of the company-specific risk be diversified away by investing in both INtRON Biotechnology and COWAY 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 INtRON Biotechnology and COWAY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iNtRON Biotechnology and COWAY Co, you can compare the effects of market volatilities on INtRON Biotechnology and COWAY 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 INtRON Biotechnology with a short position of COWAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of INtRON Biotechnology and COWAY.
Diversification Opportunities for INtRON Biotechnology and COWAY
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between INtRON and COWAY is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding iNtRON Biotechnology and COWAY Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COWAY and INtRON Biotechnology 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 iNtRON Biotechnology are associated (or correlated) with COWAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COWAY has no effect on the direction of INtRON Biotechnology i.e., INtRON Biotechnology and COWAY go up and down completely randomly.
Pair Corralation between INtRON Biotechnology and COWAY
Assuming the 90 days trading horizon INtRON Biotechnology is expected to generate 8.24 times less return on investment than COWAY. But when comparing it to its historical volatility, iNtRON Biotechnology is 1.6 times less risky than COWAY. It trades about 0.05 of its potential returns per unit of risk. COWAY Co is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 6,700,000 in COWAY Co on November 3, 2024 and sell it today you would earn a total of 1,030,000 from holding COWAY Co or generate 15.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
iNtRON Biotechnology vs. COWAY Co
Performance |
| Timeline |
| iNtRON Biotechnology |
| COWAY |
INtRON Biotechnology and COWAY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INtRON Biotechnology and COWAY
The main advantage of trading using opposite INtRON Biotechnology and COWAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INtRON Biotechnology position performs unexpectedly, COWAY 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 COWAY will offset losses from the drop in COWAY's long position.| INtRON Biotechnology vs. Medy Tox | INtRON Biotechnology vs. Oscotec | INtRON Biotechnology vs. Genexine | INtRON Biotechnology vs. Helixmith Co |
| COWAY vs. Dongwoo Farm To | COWAY vs. Seoam Machinery Industry | COWAY vs. Jin Air Co | COWAY vs. Lotte Non Life Insurance |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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