Correlation Between Shanxi Lanhua and Bloomage Biotechnology
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By analyzing existing cross correlation between Shanxi Lanhua Sci Tech and Bloomage Biotechnology Corp, you can compare the effects of market volatilities on Shanxi Lanhua and Bloomage Biotechnology 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 Shanxi Lanhua with a short position of Bloomage Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanxi Lanhua and Bloomage Biotechnology.
Diversification Opportunities for Shanxi Lanhua and Bloomage Biotechnology
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanxi and Bloomage is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Shanxi Lanhua Sci Tech and Bloomage Biotechnology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomage Biotechnology and Shanxi Lanhua 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 Shanxi Lanhua Sci Tech are associated (or correlated) with Bloomage Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomage Biotechnology has no effect on the direction of Shanxi Lanhua i.e., Shanxi Lanhua and Bloomage Biotechnology go up and down completely randomly.
Pair Corralation between Shanxi Lanhua and Bloomage Biotechnology
Assuming the 90 days trading horizon Shanxi Lanhua Sci Tech is expected to under-perform the Bloomage Biotechnology. But the stock apears to be less risky and, when comparing its historical volatility, Shanxi Lanhua Sci Tech is 1.48 times less risky than Bloomage Biotechnology. The stock trades about -0.03 of its potential returns per unit of risk. The Bloomage Biotechnology Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 5,817 in Bloomage Biotechnology Corp on September 3, 2024 and sell it today you would earn a total of 99.00 from holding Bloomage Biotechnology Corp or generate 1.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanxi Lanhua Sci Tech vs. Bloomage Biotechnology Corp
Performance |
| Timeline |
| Shanxi Lanhua Sci |
| Bloomage Biotechnology |
Shanxi Lanhua and Bloomage Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanxi Lanhua and Bloomage Biotechnology
The main advantage of trading using opposite Shanxi Lanhua and Bloomage Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanxi Lanhua position performs unexpectedly, Bloomage Biotechnology 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 Bloomage Biotechnology will offset losses from the drop in Bloomage Biotechnology's long position.| Shanxi Lanhua vs. Gansu Jiu Steel | Shanxi Lanhua vs. Ming Yang Smart | Shanxi Lanhua vs. Aba Chemicals Corp | Shanxi Lanhua vs. Loctek Ergonomic Technology |
| Bloomage Biotechnology vs. Kangping Technology Co | Bloomage Biotechnology vs. HanS Laser Tech | Bloomage Biotechnology vs. Niutech Environment Technology | Bloomage Biotechnology vs. Keli Sensing Technology |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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