Correlation Between Beijing YanDong and Cathay Biotech
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By analyzing existing cross correlation between Beijing YanDong MicroElectronic and Cathay Biotech, you can compare the effects of market volatilities on Beijing YanDong and Cathay Biotech 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 Beijing YanDong with a short position of Cathay Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing YanDong and Cathay Biotech.
Diversification Opportunities for Beijing YanDong and Cathay Biotech
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijing and Cathay is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Beijing YanDong MicroElectroni and Cathay Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathay Biotech and Beijing YanDong 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 Beijing YanDong MicroElectronic are associated (or correlated) with Cathay Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathay Biotech has no effect on the direction of Beijing YanDong i.e., Beijing YanDong and Cathay Biotech go up and down completely randomly.
Pair Corralation between Beijing YanDong and Cathay Biotech
Assuming the 90 days trading horizon Beijing YanDong MicroElectronic is expected to generate 1.35 times more return on investment than Cathay Biotech. However, Beijing YanDong is 1.35 times more volatile than Cathay Biotech. It trades about 0.0 of its potential returns per unit of risk. Cathay Biotech is currently generating about -0.03 per unit of risk. If you would invest 2,315 in Beijing YanDong MicroElectronic on October 25, 2024 and sell it today you would lose (391.00) from holding Beijing YanDong MicroElectronic or give up 16.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing YanDong MicroElectroni vs. Cathay Biotech
Performance |
| Timeline |
| Beijing YanDong Micr |
| Cathay Biotech |
Beijing YanDong and Cathay Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing YanDong and Cathay Biotech
The main advantage of trading using opposite Beijing YanDong and Cathay Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing YanDong position performs unexpectedly, Cathay Biotech 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 Cathay Biotech will offset losses from the drop in Cathay Biotech's long position.| Beijing YanDong vs. Kweichow Moutai Co | Beijing YanDong vs. NAURA Technology Group | Beijing YanDong vs. APT Medical | Beijing YanDong vs. BYD Co Ltd |
| Cathay Biotech vs. Digiwin Software Co | Cathay Biotech vs. Bangyan Technology Co | Cathay Biotech vs. Dhc Software Co | Cathay Biotech vs. Jiujiang Shanshui Technology |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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