Correlation Between Chun Yuan and Apex Biotechnology
Can any of the company-specific risk be diversified away by investing in both Chun Yuan and Apex 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 Chun Yuan and Apex Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chun Yuan Steel and Apex Biotechnology Corp, you can compare the effects of market volatilities on Chun Yuan and Apex 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 Chun Yuan with a short position of Apex Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chun Yuan and Apex Biotechnology.
Diversification Opportunities for Chun Yuan and Apex Biotechnology
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Chun and Apex is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Chun Yuan Steel and Apex Biotechnology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Biotechnology Corp and Chun Yuan 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 Chun Yuan Steel are associated (or correlated) with Apex Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Biotechnology Corp has no effect on the direction of Chun Yuan i.e., Chun Yuan and Apex Biotechnology go up and down completely randomly.
Pair Corralation between Chun Yuan and Apex Biotechnology
Assuming the 90 days trading horizon Chun Yuan Steel is expected to generate 1.17 times more return on investment than Apex Biotechnology. However, Chun Yuan is 1.17 times more volatile than Apex Biotechnology Corp. It trades about 0.07 of its potential returns per unit of risk. Apex Biotechnology Corp is currently generating about -0.16 per unit of risk. If you would invest 1,820 in Chun Yuan Steel on August 31, 2024 and sell it today you would earn a total of 30.00 from holding Chun Yuan Steel or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chun Yuan Steel vs. Apex Biotechnology Corp
Performance |
| Timeline |
| Chun Yuan Steel |
| Apex Biotechnology Corp |
Chun Yuan and Apex Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chun Yuan and Apex Biotechnology
The main advantage of trading using opposite Chun Yuan and Apex Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chun Yuan position performs unexpectedly, Apex 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 Apex Biotechnology will offset losses from the drop in Apex Biotechnology's long position.| Chun Yuan vs. Hsin Kuang Steel | Chun Yuan vs. Chung Hung Steel | Chun Yuan vs. China Steel Structure | Chun Yuan vs. Feng Hsin Steel |
| Apex Biotechnology vs. Grape King Bio | Apex Biotechnology vs. Standard Chemical Pharmaceutical | Apex Biotechnology vs. China Steel Chemical | Apex Biotechnology vs. Sinphar Pharmaceutical 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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