Correlation Between Chi Sheng and Bioteque
Can any of the company-specific risk be diversified away by investing in both Chi Sheng and Bioteque 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 Chi Sheng and Bioteque into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chi Sheng Chemical and Bioteque, you can compare the effects of market volatilities on Chi Sheng and Bioteque 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 Chi Sheng with a short position of Bioteque. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chi Sheng and Bioteque.
Diversification Opportunities for Chi Sheng and Bioteque
Good diversification
The 3 months correlation between Chi and Bioteque is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Chi Sheng Chemical and Bioteque in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bioteque and Chi Sheng 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 Chi Sheng Chemical are associated (or correlated) with Bioteque. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bioteque has no effect on the direction of Chi Sheng i.e., Chi Sheng and Bioteque go up and down completely randomly.
Pair Corralation between Chi Sheng and Bioteque
Assuming the 90 days trading horizon Chi Sheng is expected to generate 1.9 times less return on investment than Bioteque. In addition to that, Chi Sheng is 1.04 times more volatile than Bioteque. It trades about 0.03 of its total potential returns per unit of risk. Bioteque is currently generating about 0.06 per unit of volatility. If you would invest 10,284 in Bioteque on September 4, 2024 and sell it today you would earn a total of 2,316 from holding Bioteque or generate 22.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chi Sheng Chemical vs. Bioteque
Performance |
| Timeline |
| Chi Sheng Chemical |
| Bioteque |
Chi Sheng and Bioteque Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chi Sheng and Bioteque
The main advantage of trading using opposite Chi Sheng and Bioteque positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chi Sheng position performs unexpectedly, Bioteque 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 Bioteque will offset losses from the drop in Bioteque's long position.| Chi Sheng vs. WiseChip Semiconductor | Chi Sheng vs. Novatek Microelectronics Corp | Chi Sheng vs. Leader Electronics | Chi Sheng vs. Information Technology Total |
| Bioteque vs. StShine Optical Co | Bioteque vs. United Orthopedic | Bioteque vs. Excelsior Medical Co | Bioteque vs. Pacific Hospital Supply |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |