Correlation Between Bloomage Biotechnology and Do Fluoride
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By analyzing existing cross correlation between Bloomage Biotechnology Corp and Do Fluoride Chemicals Co, you can compare the effects of market volatilities on Bloomage Biotechnology and Do Fluoride 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 Bloomage Biotechnology with a short position of Do Fluoride. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloomage Biotechnology and Do Fluoride.
Diversification Opportunities for Bloomage Biotechnology and Do Fluoride
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bloomage and 002407 is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Bloomage Biotechnology Corp and Do Fluoride Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Do Fluoride Chemicals and Bloomage Biotechnology 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 Bloomage Biotechnology Corp are associated (or correlated) with Do Fluoride. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Do Fluoride Chemicals has no effect on the direction of Bloomage Biotechnology i.e., Bloomage Biotechnology and Do Fluoride go up and down completely randomly.
Pair Corralation between Bloomage Biotechnology and Do Fluoride
Assuming the 90 days trading horizon Bloomage Biotechnology Corp is expected to generate 1.09 times more return on investment than Do Fluoride. However, Bloomage Biotechnology is 1.09 times more volatile than Do Fluoride Chemicals Co. It trades about -0.35 of its potential returns per unit of risk. Do Fluoride Chemicals Co is currently generating about -0.41 per unit of risk. If you would invest 5,745 in Bloomage Biotechnology Corp on October 16, 2024 and sell it today you would lose (708.00) from holding Bloomage Biotechnology Corp or give up 12.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloomage Biotechnology Corp vs. Do Fluoride Chemicals Co
Performance |
| Timeline |
| Bloomage Biotechnology |
| Do Fluoride Chemicals |
Bloomage Biotechnology and Do Fluoride Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloomage Biotechnology and Do Fluoride
The main advantage of trading using opposite Bloomage Biotechnology and Do Fluoride positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloomage Biotechnology position performs unexpectedly, Do Fluoride 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 Do Fluoride will offset losses from the drop in Do Fluoride's long position.The idea behind Bloomage Biotechnology Corp and Do Fluoride Chemicals Co 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.
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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