Correlation Between OBI Pharma and I Chiun
Can any of the company-specific risk be diversified away by investing in both OBI Pharma and I Chiun 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 OBI Pharma and I Chiun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OBI Pharma and I Chiun Precision Industry, you can compare the effects of market volatilities on OBI Pharma and I Chiun 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 OBI Pharma with a short position of I Chiun. Check out your portfolio center. Please also check ongoing floating volatility patterns of OBI Pharma and I Chiun.
Diversification Opportunities for OBI Pharma and I Chiun
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OBI and 2486 is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding OBI Pharma and I Chiun Precision Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on I Chiun Precision and OBI Pharma 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 OBI Pharma are associated (or correlated) with I Chiun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of I Chiun Precision has no effect on the direction of OBI Pharma i.e., OBI Pharma and I Chiun go up and down completely randomly.
Pair Corralation between OBI Pharma and I Chiun
Assuming the 90 days trading horizon OBI Pharma is expected to under-perform the I Chiun. But the stock apears to be less risky and, when comparing its historical volatility, OBI Pharma is 1.82 times less risky than I Chiun. The stock trades about -0.04 of its potential returns per unit of risk. The I Chiun Precision Industry is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,575 in I Chiun Precision Industry on August 27, 2024 and sell it today you would earn a total of 6,475 from holding I Chiun Precision Industry or generate 141.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OBI Pharma vs. I Chiun Precision Industry
Performance |
| Timeline |
| OBI Pharma |
| I Chiun Precision |
OBI Pharma and I Chiun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OBI Pharma and I Chiun
The main advantage of trading using opposite OBI Pharma and I Chiun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OBI Pharma position performs unexpectedly, I Chiun 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 I Chiun will offset losses from the drop in I Chiun's long position.| OBI Pharma vs. TaiMed Biologics | OBI Pharma vs. PharmaEngine | OBI Pharma vs. Medigen Biotechnology | OBI Pharma vs. TTY Biopharm Co |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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