Correlation Between Lotes and Synmosa Biopharma
Can any of the company-specific risk be diversified away by investing in both Lotes and Synmosa Biopharma 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 Lotes and Synmosa Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotes Co and Synmosa Biopharma, you can compare the effects of market volatilities on Lotes and Synmosa Biopharma 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 Lotes with a short position of Synmosa Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotes and Synmosa Biopharma.
Diversification Opportunities for Lotes and Synmosa Biopharma
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lotes and Synmosa is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Lotes Co and Synmosa Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synmosa Biopharma and Lotes 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 Lotes Co are associated (or correlated) with Synmosa Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synmosa Biopharma has no effect on the direction of Lotes i.e., Lotes and Synmosa Biopharma go up and down completely randomly.
Pair Corralation between Lotes and Synmosa Biopharma
Assuming the 90 days trading horizon Lotes Co is expected to generate 3.4 times more return on investment than Synmosa Biopharma. However, Lotes is 3.4 times more volatile than Synmosa Biopharma. It trades about 0.16 of its potential returns per unit of risk. Synmosa Biopharma is currently generating about -0.24 per unit of risk. If you would invest 138,500 in Lotes Co on August 30, 2024 and sell it today you would earn a total of 26,500 from holding Lotes Co or generate 19.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotes Co vs. Synmosa Biopharma
Performance |
| Timeline |
| Lotes |
| Synmosa Biopharma |
Lotes and Synmosa Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotes and Synmosa Biopharma
The main advantage of trading using opposite Lotes and Synmosa Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotes position performs unexpectedly, Synmosa Biopharma 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 Synmosa Biopharma will offset losses from the drop in Synmosa Biopharma's long position.| Lotes vs. Unimicron Technology Corp | Lotes vs. Alchip Technologies | Lotes vs. Nan Ya Printed | Lotes vs. Global Unichip Corp |
| Synmosa Biopharma vs. Tai Tung Communication | Synmosa Biopharma vs. Professional Computer Technology | Synmosa Biopharma vs. Cameo Communications | Synmosa Biopharma vs. Hannstar Display Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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