Correlation Between Intech Biopharm and ThinTech Materials
Can any of the company-specific risk be diversified away by investing in both Intech Biopharm and ThinTech Materials 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 Intech Biopharm and ThinTech Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intech Biopharm and ThinTech Materials Technology, you can compare the effects of market volatilities on Intech Biopharm and ThinTech Materials 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 Intech Biopharm with a short position of ThinTech Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intech Biopharm and ThinTech Materials.
Diversification Opportunities for Intech Biopharm and ThinTech Materials
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Intech and ThinTech is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Intech Biopharm and ThinTech Materials Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ThinTech Materials and Intech Biopharm 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 Intech Biopharm are associated (or correlated) with ThinTech Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ThinTech Materials has no effect on the direction of Intech Biopharm i.e., Intech Biopharm and ThinTech Materials go up and down completely randomly.
Pair Corralation between Intech Biopharm and ThinTech Materials
Assuming the 90 days trading horizon Intech Biopharm is expected to generate 0.41 times more return on investment than ThinTech Materials. However, Intech Biopharm is 2.43 times less risky than ThinTech Materials. It trades about -0.36 of its potential returns per unit of risk. ThinTech Materials Technology is currently generating about -0.27 per unit of risk. If you would invest 2,650 in Intech Biopharm on October 25, 2024 and sell it today you would lose (230.00) from holding Intech Biopharm or give up 8.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intech Biopharm vs. ThinTech Materials Technology
Performance |
| Timeline |
| Intech Biopharm |
| ThinTech Materials |
Intech Biopharm and ThinTech Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intech Biopharm and ThinTech Materials
The main advantage of trading using opposite Intech Biopharm and ThinTech Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intech Biopharm position performs unexpectedly, ThinTech Materials 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 ThinTech Materials will offset losses from the drop in ThinTech Materials' long position.| Intech Biopharm vs. First Copper Technology | Intech Biopharm vs. Elitegroup Computer Systems | Intech Biopharm vs. Compal Broadband Networks | Intech Biopharm vs. Chernan Metal Industrial |
| ThinTech Materials vs. Jetwell Computer Co | ThinTech Materials vs. U Media Communications | ThinTech Materials vs. Iron Force Industrial | ThinTech Materials vs. Elitegroup Computer Systems |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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