Correlation Between Kinko Optical and GeneFerm Biotechnology
Can any of the company-specific risk be diversified away by investing in both Kinko Optical and GeneFerm 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 Kinko Optical and GeneFerm Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinko Optical Co and GeneFerm Biotechnology Co, you can compare the effects of market volatilities on Kinko Optical and GeneFerm 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 Kinko Optical with a short position of GeneFerm Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinko Optical and GeneFerm Biotechnology.
Diversification Opportunities for Kinko Optical and GeneFerm Biotechnology
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kinko and GeneFerm is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Kinko Optical Co and GeneFerm Biotechnology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GeneFerm Biotechnology and Kinko Optical 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 Kinko Optical Co are associated (or correlated) with GeneFerm Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GeneFerm Biotechnology has no effect on the direction of Kinko Optical i.e., Kinko Optical and GeneFerm Biotechnology go up and down completely randomly.
Pair Corralation between Kinko Optical and GeneFerm Biotechnology
Assuming the 90 days trading horizon Kinko Optical Co is expected to generate 0.96 times more return on investment than GeneFerm Biotechnology. However, Kinko Optical Co is 1.04 times less risky than GeneFerm Biotechnology. It trades about 0.0 of its potential returns per unit of risk. GeneFerm Biotechnology Co is currently generating about -0.07 per unit of risk. If you would invest 2,625 in Kinko Optical Co on September 4, 2024 and sell it today you would lose (135.00) from holding Kinko Optical Co or give up 5.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinko Optical Co vs. GeneFerm Biotechnology Co
Performance |
| Timeline |
| Kinko Optical |
| GeneFerm Biotechnology |
Kinko Optical and GeneFerm Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinko Optical and GeneFerm Biotechnology
The main advantage of trading using opposite Kinko Optical and GeneFerm Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinko Optical position performs unexpectedly, GeneFerm 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 GeneFerm Biotechnology will offset losses from the drop in GeneFerm Biotechnology's long position.| Kinko Optical vs. Asia Optical Co | Kinko Optical vs. Genius Electronic Optical | Kinko Optical vs. Altek Corp | Kinko Optical vs. Hannstar Display Corp |
| GeneFerm Biotechnology vs. Ruentex Development Co | GeneFerm Biotechnology vs. Symtek Automation Asia | GeneFerm Biotechnology vs. CTCI Corp | GeneFerm Biotechnology vs. Information Technology Total |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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