Correlation Between Ray and TR Biofab
Can any of the company-specific risk be diversified away by investing in both Ray and TR Biofab 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 Ray and TR Biofab into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ray Co and TR Biofab Co, you can compare the effects of market volatilities on Ray and TR Biofab 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 Ray with a short position of TR Biofab. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ray and TR Biofab.
Diversification Opportunities for Ray and TR Biofab
Weak diversification
The 3 months correlation between Ray and 246710 is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ray Co and TR Biofab Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TR Biofab and Ray 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 Ray Co are associated (or correlated) with TR Biofab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TR Biofab has no effect on the direction of Ray i.e., Ray and TR Biofab go up and down completely randomly.
Pair Corralation between Ray and TR Biofab
Assuming the 90 days trading horizon Ray Co is expected to generate 1.02 times more return on investment than TR Biofab. However, Ray is 1.02 times more volatile than TR Biofab Co. It trades about -0.05 of its potential returns per unit of risk. TR Biofab Co is currently generating about -0.05 per unit of risk. If you would invest 2,370,000 in Ray Co on November 2, 2024 and sell it today you would lose (1,581,000) from holding Ray Co or give up 66.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ray Co vs. TR Biofab Co
Performance |
| Timeline |
| Ray Co |
| TR Biofab |
Ray and TR Biofab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ray and TR Biofab
The main advantage of trading using opposite Ray and TR Biofab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ray position performs unexpectedly, TR Biofab 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 TR Biofab will offset losses from the drop in TR Biofab's long position.| Ray vs. Lee Ku Industrial | Ray vs. Industrial Bank | Ray vs. Anam Electronics Co | Ray vs. Hyunwoo Industrial Co |
| TR Biofab vs. Asiana Airlines | TR Biofab vs. Eugene Technology CoLtd | TR Biofab vs. Kg Chemical | TR Biofab vs. Seers 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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