Correlation Between Daxin Materials and Ok Biotech
Can any of the company-specific risk be diversified away by investing in both Daxin Materials and Ok Biotech 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 Daxin Materials and Ok Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daxin Materials Corp and Ok Biotech Co, you can compare the effects of market volatilities on Daxin Materials and Ok Biotech 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 Daxin Materials with a short position of Ok Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daxin Materials and Ok Biotech.
Diversification Opportunities for Daxin Materials and Ok Biotech
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Daxin and 4155 is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Daxin Materials Corp and Ok Biotech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ok Biotech and Daxin Materials 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 Daxin Materials Corp are associated (or correlated) with Ok Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ok Biotech has no effect on the direction of Daxin Materials i.e., Daxin Materials and Ok Biotech go up and down completely randomly.
Pair Corralation between Daxin Materials and Ok Biotech
Assuming the 90 days trading horizon Daxin Materials Corp is expected to generate 1.71 times more return on investment than Ok Biotech. However, Daxin Materials is 1.71 times more volatile than Ok Biotech Co. It trades about 0.09 of its potential returns per unit of risk. Ok Biotech Co is currently generating about 0.0 per unit of risk. If you would invest 6,710 in Daxin Materials Corp on September 12, 2024 and sell it today you would earn a total of 14,040 from holding Daxin Materials Corp or generate 209.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Daxin Materials Corp vs. Ok Biotech Co
Performance |
| Timeline |
| Daxin Materials Corp |
| Ok Biotech |
Daxin Materials and Ok Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daxin Materials and Ok Biotech
The main advantage of trading using opposite Daxin Materials and Ok Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daxin Materials position performs unexpectedly, Ok Biotech 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 Ok Biotech will offset losses from the drop in Ok Biotech's long position.| Daxin Materials vs. Tainan Spinning Co | Daxin Materials vs. Lealea Enterprise Co | Daxin Materials vs. China Petrochemical Development | Daxin Materials vs. Ruentex Development Co |
| Ok Biotech vs. U Media Communications | Ok Biotech vs. Newretail Co | Ok Biotech vs. Holiday Entertainment Co | Ok Biotech vs. Galaxy Software Services |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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