Correlation Between Ok Biotech and Delta Asia
Can any of the company-specific risk be diversified away by investing in both Ok Biotech and Delta Asia 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 Ok Biotech and Delta Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ok Biotech Co and Delta Asia International, you can compare the effects of market volatilities on Ok Biotech and Delta Asia 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 Ok Biotech with a short position of Delta Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ok Biotech and Delta Asia.
Diversification Opportunities for Ok Biotech and Delta Asia
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 4155 and Delta is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ok Biotech Co and Delta Asia International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Asia International and Ok Biotech 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 Ok Biotech Co are associated (or correlated) with Delta Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Asia International has no effect on the direction of Ok Biotech i.e., Ok Biotech and Delta Asia go up and down completely randomly.
Pair Corralation between Ok Biotech and Delta Asia
Assuming the 90 days trading horizon Ok Biotech Co is expected to under-perform the Delta Asia. But the stock apears to be less risky and, when comparing its historical volatility, Ok Biotech Co is 1.03 times less risky than Delta Asia. The stock trades about -0.02 of its potential returns per unit of risk. The Delta Asia International is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 25,000 in Delta Asia International on September 1, 2024 and sell it today you would earn a total of 2,400 from holding Delta Asia International or generate 9.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ok Biotech Co vs. Delta Asia International
Performance |
| Timeline |
| Ok Biotech |
| Delta Asia International |
Ok Biotech and Delta Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ok Biotech and Delta Asia
The main advantage of trading using opposite Ok Biotech and Delta Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ok Biotech position performs unexpectedly, Delta Asia 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 Delta Asia will offset losses from the drop in Delta Asia's long position.| Ok Biotech vs. Universal Vision Biotechnology | Ok Biotech vs. Excelsior Medical Co | Ok Biotech vs. Hi Clearance | Ok Biotech vs. Brighten Optix |
| Delta Asia vs. Universal Vision Biotechnology | Delta Asia vs. Excelsior Medical Co | Delta Asia vs. Hi Clearance | Delta Asia vs. Brighten Optix |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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