Correlation Between Genovate Biotechnology and Asmedia Technology
Can any of the company-specific risk be diversified away by investing in both Genovate Biotechnology and Asmedia Technology 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 Genovate Biotechnology and Asmedia Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genovate Biotechnology Co and Asmedia Technology, you can compare the effects of market volatilities on Genovate Biotechnology and Asmedia Technology 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 Genovate Biotechnology with a short position of Asmedia Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genovate Biotechnology and Asmedia Technology.
Diversification Opportunities for Genovate Biotechnology and Asmedia Technology
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Genovate and Asmedia is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Genovate Biotechnology Co and Asmedia Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asmedia Technology and Genovate Biotechnology 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 Genovate Biotechnology Co are associated (or correlated) with Asmedia Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asmedia Technology has no effect on the direction of Genovate Biotechnology i.e., Genovate Biotechnology and Asmedia Technology go up and down completely randomly.
Pair Corralation between Genovate Biotechnology and Asmedia Technology
Assuming the 90 days trading horizon Genovate Biotechnology is expected to generate 2.43 times less return on investment than Asmedia Technology. In addition to that, Genovate Biotechnology is 1.57 times more volatile than Asmedia Technology. It trades about 0.02 of its total potential returns per unit of risk. Asmedia Technology is currently generating about 0.06 per unit of volatility. If you would invest 98,945 in Asmedia Technology on October 30, 2024 and sell it today you would earn a total of 108,055 from holding Asmedia Technology or generate 109.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Genovate Biotechnology Co vs. Asmedia Technology
Performance |
| Timeline |
| Genovate Biotechnology |
| Asmedia Technology |
Genovate Biotechnology and Asmedia Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genovate Biotechnology and Asmedia Technology
The main advantage of trading using opposite Genovate Biotechnology and Asmedia Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genovate Biotechnology position performs unexpectedly, Asmedia Technology 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 Asmedia Technology will offset losses from the drop in Asmedia Technology's long position.| Genovate Biotechnology vs. Realtek Semiconductor Corp | Genovate Biotechnology vs. Simple Mart Retail | Genovate Biotechnology vs. Niko Semiconductor Co | Genovate Biotechnology vs. Syntek Semiconductor Co |
| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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