Correlation Between Changchun BCHT and Innovative Medical
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Innovative Medical Management, you can compare the effects of market volatilities on Changchun BCHT and Innovative Medical 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 Changchun BCHT with a short position of Innovative Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Innovative Medical.
Diversification Opportunities for Changchun BCHT and Innovative Medical
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Changchun and Innovative is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Innovative Medical Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovative Medical and Changchun BCHT 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 Changchun BCHT Biotechnology are associated (or correlated) with Innovative Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovative Medical has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Innovative Medical go up and down completely randomly.
Pair Corralation between Changchun BCHT and Innovative Medical
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to under-perform the Innovative Medical. But the stock apears to be less risky and, when comparing its historical volatility, Changchun BCHT Biotechnology is 1.94 times less risky than Innovative Medical. The stock trades about -0.14 of its potential returns per unit of risk. The Innovative Medical Management is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 765.00 in Innovative Medical Management on August 28, 2024 and sell it today you would earn a total of 73.00 from holding Innovative Medical Management or generate 9.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Innovative Medical Management
Performance |
| Timeline |
| Changchun BCHT Biote |
| Innovative Medical |
Changchun BCHT and Innovative Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Innovative Medical
The main advantage of trading using opposite Changchun BCHT and Innovative Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Innovative Medical 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 Innovative Medical will offset losses from the drop in Innovative Medical's long position.| Changchun BCHT vs. Industrial and Commercial | Changchun BCHT vs. Agricultural Bank of | Changchun BCHT vs. China Construction Bank | Changchun BCHT vs. Bank of China |
| Innovative Medical vs. Industrial and Commercial | Innovative Medical vs. China Construction Bank | Innovative Medical vs. Agricultural Bank of | Innovative Medical vs. Bank of China |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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