Correlation Between Cabio Biotech and Fujian Boss
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By analyzing existing cross correlation between Cabio Biotech Wuhan and Fujian Boss Software, you can compare the effects of market volatilities on Cabio Biotech and Fujian Boss 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 Cabio Biotech with a short position of Fujian Boss. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabio Biotech and Fujian Boss.
Diversification Opportunities for Cabio Biotech and Fujian Boss
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cabio and Fujian is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Cabio Biotech Wuhan and Fujian Boss Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Boss Software and Cabio Biotech 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 Cabio Biotech Wuhan are associated (or correlated) with Fujian Boss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Boss Software has no effect on the direction of Cabio Biotech i.e., Cabio Biotech and Fujian Boss go up and down completely randomly.
Pair Corralation between Cabio Biotech and Fujian Boss
Assuming the 90 days trading horizon Cabio Biotech Wuhan is expected to generate 1.08 times more return on investment than Fujian Boss. However, Cabio Biotech is 1.08 times more volatile than Fujian Boss Software. It trades about 0.25 of its potential returns per unit of risk. Fujian Boss Software is currently generating about 0.16 per unit of risk. If you would invest 1,828 in Cabio Biotech Wuhan on November 8, 2024 and sell it today you would earn a total of 173.00 from holding Cabio Biotech Wuhan or generate 9.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cabio Biotech Wuhan vs. Fujian Boss Software
Performance |
| Timeline |
| Cabio Biotech Wuhan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fujian Boss Software |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cabio Biotech and Fujian Boss Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabio Biotech and Fujian Boss
The main advantage of trading using opposite Cabio Biotech and Fujian Boss positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabio Biotech position performs unexpectedly, Fujian Boss 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 Fujian Boss will offset losses from the drop in Fujian Boss' long position.The idea behind Cabio Biotech Wuhan and Fujian Boss Software 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.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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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