Correlation Between Cameo Communications and Sunmax Biotechnology
Can any of the company-specific risk be diversified away by investing in both Cameo Communications and Sunmax Biotechnology 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 Cameo Communications and Sunmax Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cameo Communications and Sunmax Biotechnology Co, you can compare the effects of market volatilities on Cameo Communications and Sunmax 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 Cameo Communications with a short position of Sunmax Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cameo Communications and Sunmax Biotechnology.
Diversification Opportunities for Cameo Communications and Sunmax Biotechnology
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cameo and Sunmax is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Cameo Communications and Sunmax Biotechnology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunmax Biotechnology and Cameo Communications 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 Cameo Communications are associated (or correlated) with Sunmax Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunmax Biotechnology has no effect on the direction of Cameo Communications i.e., Cameo Communications and Sunmax Biotechnology go up and down completely randomly.
Pair Corralation between Cameo Communications and Sunmax Biotechnology
Assuming the 90 days trading horizon Cameo Communications is expected to under-perform the Sunmax Biotechnology. In addition to that, Cameo Communications is 3.02 times more volatile than Sunmax Biotechnology Co. It trades about -0.12 of its total potential returns per unit of risk. Sunmax Biotechnology Co is currently generating about 0.11 per unit of volatility. If you would invest 27,300 in Sunmax Biotechnology Co on September 2, 2024 and sell it today you would earn a total of 500.00 from holding Sunmax Biotechnology Co or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cameo Communications vs. Sunmax Biotechnology Co
Performance |
| Timeline |
| Cameo Communications |
| Sunmax Biotechnology |
Cameo Communications and Sunmax Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cameo Communications and Sunmax Biotechnology
The main advantage of trading using opposite Cameo Communications and Sunmax Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cameo Communications position performs unexpectedly, Sunmax 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 Sunmax Biotechnology will offset losses from the drop in Sunmax Biotechnology's long position.The idea behind Cameo Communications and Sunmax Biotechnology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sunmax Biotechnology vs. Medigen Vaccine Biologics | Sunmax Biotechnology vs. TaiMed Biologics | Sunmax Biotechnology vs. Tanvex BioPharma | Sunmax Biotechnology vs. Adimmune 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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