Correlation Between INtRON Biotechnology and IQuest
Can any of the company-specific risk be diversified away by investing in both INtRON Biotechnology and IQuest 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 IQuest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iNtRON Biotechnology and IQuest Co, you can compare the effects of market volatilities on INtRON Biotechnology and IQuest 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 IQuest. Check out your portfolio center. Please also check ongoing floating volatility patterns of INtRON Biotechnology and IQuest.
Diversification Opportunities for INtRON Biotechnology and IQuest
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between INtRON and IQuest is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding iNtRON Biotechnology and IQuest Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQuest 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 IQuest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQuest has no effect on the direction of INtRON Biotechnology i.e., INtRON Biotechnology and IQuest go up and down completely randomly.
Pair Corralation between INtRON Biotechnology and IQuest
Assuming the 90 days trading horizon iNtRON Biotechnology is expected to under-perform the IQuest. But the stock apears to be less risky and, when comparing its historical volatility, iNtRON Biotechnology is 1.72 times less risky than IQuest. The stock trades about -0.07 of its potential returns per unit of risk. The IQuest Co is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 223,000 in IQuest Co on August 28, 2024 and sell it today you would earn a total of 19,500 from holding IQuest Co or generate 8.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iNtRON Biotechnology vs. IQuest Co
Performance |
| Timeline |
| iNtRON Biotechnology |
| IQuest |
INtRON Biotechnology and IQuest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INtRON Biotechnology and IQuest
The main advantage of trading using opposite INtRON Biotechnology and IQuest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INtRON Biotechnology position performs unexpectedly, IQuest 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 IQuest will offset losses from the drop in IQuest's long position.| INtRON Biotechnology vs. Medy Tox | INtRON Biotechnology vs. Busan Industrial Co | INtRON Biotechnology vs. Busan Ind | INtRON Biotechnology vs. Mirae Asset Daewoo |
| IQuest vs. iNtRON Biotechnology | IQuest vs. Ilji Technology Co | IQuest vs. Shinhan Inverse Silver | IQuest vs. Konan Technology |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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