Correlation Between Lion Biotechnologies and ADRIATIC METALS
Can any of the company-specific risk be diversified away by investing in both Lion Biotechnologies and ADRIATIC METALS 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 Lion Biotechnologies and ADRIATIC METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion Biotechnologies and ADRIATIC METALS LS 013355, you can compare the effects of market volatilities on Lion Biotechnologies and ADRIATIC METALS 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 Lion Biotechnologies with a short position of ADRIATIC METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion Biotechnologies and ADRIATIC METALS.
Diversification Opportunities for Lion Biotechnologies and ADRIATIC METALS
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lion and ADRIATIC is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Lion Biotechnologies and ADRIATIC METALS LS 013355 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADRIATIC METALS LS and Lion Biotechnologies 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 Lion Biotechnologies are associated (or correlated) with ADRIATIC METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADRIATIC METALS LS has no effect on the direction of Lion Biotechnologies i.e., Lion Biotechnologies and ADRIATIC METALS go up and down completely randomly.
Pair Corralation between Lion Biotechnologies and ADRIATIC METALS
Assuming the 90 days trading horizon Lion Biotechnologies is expected to under-perform the ADRIATIC METALS. In addition to that, Lion Biotechnologies is 1.42 times more volatile than ADRIATIC METALS LS 013355. It trades about -0.12 of its total potential returns per unit of risk. ADRIATIC METALS LS 013355 is currently generating about 0.03 per unit of volatility. If you would invest 240.00 in ADRIATIC METALS LS 013355 on September 22, 2024 and sell it today you would earn a total of 2.00 from holding ADRIATIC METALS LS 013355 or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion Biotechnologies vs. ADRIATIC METALS LS 013355
Performance |
| Timeline |
| Lion Biotechnologies |
| ADRIATIC METALS LS |
Lion Biotechnologies and ADRIATIC METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion Biotechnologies and ADRIATIC METALS
The main advantage of trading using opposite Lion Biotechnologies and ADRIATIC METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion Biotechnologies position performs unexpectedly, ADRIATIC METALS 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 ADRIATIC METALS will offset losses from the drop in ADRIATIC METALS's long position.| Lion Biotechnologies vs. DIVERSIFIED ROYALTY | Lion Biotechnologies vs. SALESFORCE INC CDR | Lion Biotechnologies vs. RETAIL FOOD GROUP | Lion Biotechnologies vs. CANON MARKETING JP |
| ADRIATIC METALS vs. Lion Biotechnologies | ADRIATIC METALS vs. Digilife Technologies Limited | ADRIATIC METALS vs. DEVRY EDUCATION GRP | ADRIATIC METALS vs. Grand Canyon Education |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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