Correlation Between Global Unichip and Golden Biotechnology
Can any of the company-specific risk be diversified away by investing in both Global Unichip and Golden 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 Global Unichip and Golden Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Unichip Corp and Golden Biotechnology, you can compare the effects of market volatilities on Global Unichip and Golden 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 Global Unichip with a short position of Golden Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Unichip and Golden Biotechnology.
Diversification Opportunities for Global Unichip and Golden Biotechnology
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Golden is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Global Unichip Corp and Golden Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Biotechnology and Global Unichip 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 Global Unichip Corp are associated (or correlated) with Golden Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Biotechnology has no effect on the direction of Global Unichip i.e., Global Unichip and Golden Biotechnology go up and down completely randomly.
Pair Corralation between Global Unichip and Golden Biotechnology
Assuming the 90 days trading horizon Global Unichip Corp is expected to under-perform the Golden Biotechnology. But the stock apears to be less risky and, when comparing its historical volatility, Global Unichip Corp is 1.25 times less risky than Golden Biotechnology. The stock trades about -0.01 of its potential returns per unit of risk. The Golden Biotechnology is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,525 in Golden Biotechnology on October 23, 2024 and sell it today you would earn a total of 210.00 from holding Golden Biotechnology or generate 13.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Unichip Corp vs. Golden Biotechnology
Performance |
| Timeline |
| Global Unichip Corp |
| Golden Biotechnology |
Global Unichip and Golden Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Unichip and Golden Biotechnology
The main advantage of trading using opposite Global Unichip and Golden Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Unichip position performs unexpectedly, Golden 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 Golden Biotechnology will offset losses from the drop in Golden Biotechnology's long position.| Global Unichip vs. Alchip Technologies | Global Unichip vs. Realtek Semiconductor Corp | Global Unichip vs. Faraday Technology Corp | Global Unichip vs. Novatek Microelectronics Corp |
| Golden Biotechnology vs. Sunspring Metal Corp | Golden Biotechnology vs. Landis Taipei Hotel | Golden Biotechnology vs. Acelon Chemicals Fiber | Golden Biotechnology vs. HOYA Resort Hotel |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Stocks Directory Find actively traded stocks across global markets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |