Correlation Between Asia Technology and INtRON Biotechnology
Can any of the company-specific risk be diversified away by investing in both Asia Technology 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 Asia Technology and INtRON Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Technology Co and iNtRON Biotechnology, you can compare the effects of market volatilities on Asia Technology 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 Asia Technology with a short position of INtRON Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Technology and INtRON Biotechnology.
Diversification Opportunities for Asia Technology and INtRON Biotechnology
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Asia and INtRON is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Asia Technology Co and iNtRON Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iNtRON Biotechnology and Asia Technology 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 Asia Technology Co 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 Asia Technology i.e., Asia Technology and INtRON Biotechnology go up and down completely randomly.
Pair Corralation between Asia Technology and INtRON Biotechnology
Assuming the 90 days trading horizon Asia Technology Co is expected to generate 1.08 times more return on investment than INtRON Biotechnology. However, Asia Technology is 1.08 times more volatile than iNtRON Biotechnology. It trades about 0.06 of its potential returns per unit of risk. iNtRON Biotechnology is currently generating about -0.07 per unit of risk. If you would invest 220,000 in Asia Technology Co on August 28, 2024 and sell it today you would earn a total of 5,000 from holding Asia Technology Co or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Technology Co vs. iNtRON Biotechnology
Performance |
| Timeline |
| Asia Technology |
| iNtRON Biotechnology |
Asia Technology and INtRON Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Technology and INtRON Biotechnology
The main advantage of trading using opposite Asia Technology and INtRON Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Technology 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.| Asia Technology vs. FNC Entertainment Co | Asia Technology vs. SM Entertainment Co | Asia Technology vs. Hanwha InvestmentSecurities Co | Asia Technology vs. SBI Investment KOREA |
| INtRON Biotechnology vs. Medy Tox | INtRON Biotechnology vs. Busan Industrial Co | INtRON Biotechnology vs. Busan Ind | INtRON Biotechnology vs. Mirae Asset Daewoo |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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