Correlation Between Analog Integrations and Golden Biotechnology
Can any of the company-specific risk be diversified away by investing in both Analog Integrations and Golden 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 Analog Integrations and Golden Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Analog Integrations and Golden Biotechnology, you can compare the effects of market volatilities on Analog Integrations and Golden 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 Analog Integrations with a short position of Golden Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Analog Integrations and Golden Biotechnology.
Diversification Opportunities for Analog Integrations and Golden Biotechnology
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Analog and Golden is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Analog Integrations and Golden Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Biotechnology and Analog Integrations 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 Analog Integrations are associated (or correlated) with Golden Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Biotechnology has no effect on the direction of Analog Integrations i.e., Analog Integrations and Golden Biotechnology go up and down completely randomly.
Pair Corralation between Analog Integrations and Golden Biotechnology
Assuming the 90 days trading horizon Analog Integrations is expected to under-perform the Golden Biotechnology. In addition to that, Analog Integrations is 1.59 times more volatile than Golden Biotechnology. It trades about -0.24 of its total potential returns per unit of risk. Golden Biotechnology is currently generating about -0.24 per unit of volatility. If you would invest 1,765 in Golden Biotechnology on September 4, 2024 and sell it today you would lose (135.00) from holding Golden Biotechnology or give up 7.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Analog Integrations vs. Golden Biotechnology
Performance |
| Timeline |
| Analog Integrations |
| Golden Biotechnology |
Analog Integrations and Golden Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Analog Integrations and Golden Biotechnology
The main advantage of trading using opposite Analog Integrations and Golden Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Analog Integrations position performs unexpectedly, Golden 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 Golden Biotechnology will offset losses from the drop in Golden Biotechnology's long position.| Analog Integrations vs. Far EasTone Telecommunications | Analog Integrations vs. Sunfar Computer Co | Analog Integrations vs. Hunya Foods Co | Analog Integrations vs. U Media Communications |
| Golden Biotechnology vs. Grape King Bio | Golden Biotechnology vs. YungShin Global Holding | Golden Biotechnology vs. Standard Chemical Pharmaceutical |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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