Correlation Between GeneFerm Biotechnology and Li Peng
Can any of the company-specific risk be diversified away by investing in both GeneFerm Biotechnology and Li Peng 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 GeneFerm Biotechnology and Li Peng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GeneFerm Biotechnology Co and Li Peng Enterprise, you can compare the effects of market volatilities on GeneFerm Biotechnology and Li Peng 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 GeneFerm Biotechnology with a short position of Li Peng. Check out your portfolio center. Please also check ongoing floating volatility patterns of GeneFerm Biotechnology and Li Peng.
Diversification Opportunities for GeneFerm Biotechnology and Li Peng
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GeneFerm and 1447 is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding GeneFerm Biotechnology Co and Li Peng Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Li Peng Enterprise and GeneFerm 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 GeneFerm Biotechnology Co are associated (or correlated) with Li Peng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Li Peng Enterprise has no effect on the direction of GeneFerm Biotechnology i.e., GeneFerm Biotechnology and Li Peng go up and down completely randomly.
Pair Corralation between GeneFerm Biotechnology and Li Peng
Assuming the 90 days trading horizon GeneFerm Biotechnology Co is expected to under-perform the Li Peng. But the stock apears to be less risky and, when comparing its historical volatility, GeneFerm Biotechnology Co is 1.11 times less risky than Li Peng. The stock trades about -0.02 of its potential returns per unit of risk. The Li Peng Enterprise is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 812.00 in Li Peng Enterprise on September 3, 2024 and sell it today you would lose (36.00) from holding Li Peng Enterprise or give up 4.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GeneFerm Biotechnology Co vs. Li Peng Enterprise
Performance |
| Timeline |
| GeneFerm Biotechnology |
| Li Peng Enterprise |
GeneFerm Biotechnology and Li Peng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GeneFerm Biotechnology and Li Peng
The main advantage of trading using opposite GeneFerm Biotechnology and Li Peng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GeneFerm Biotechnology position performs unexpectedly, Li Peng 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 Li Peng will offset losses from the drop in Li Peng's long position.| GeneFerm Biotechnology vs. Ruentex Development Co | GeneFerm Biotechnology vs. Symtek Automation Asia | GeneFerm Biotechnology vs. CTCI Corp | GeneFerm Biotechnology vs. Information Technology Total |
| Li Peng vs. China Mobile | Li Peng vs. Shan Loong Transportation Co | Li Peng vs. Tainet Communication System | Li Peng vs. China Metal Products |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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