Correlation Between BRIM Biotechnology and Jia Jie
Can any of the company-specific risk be diversified away by investing in both BRIM Biotechnology and Jia Jie 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 BRIM Biotechnology and Jia Jie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRIM Biotechnology and Jia Jie Biomedical, you can compare the effects of market volatilities on BRIM Biotechnology and Jia Jie 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 BRIM Biotechnology with a short position of Jia Jie. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRIM Biotechnology and Jia Jie.
Diversification Opportunities for BRIM Biotechnology and Jia Jie
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BRIM and Jia is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding BRIM Biotechnology and Jia Jie Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jia Jie Biomedical and BRIM 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 BRIM Biotechnology are associated (or correlated) with Jia Jie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jia Jie Biomedical has no effect on the direction of BRIM Biotechnology i.e., BRIM Biotechnology and Jia Jie go up and down completely randomly.
Pair Corralation between BRIM Biotechnology and Jia Jie
Assuming the 90 days trading horizon BRIM Biotechnology is expected to generate 0.61 times more return on investment than Jia Jie. However, BRIM Biotechnology is 1.64 times less risky than Jia Jie. It trades about 0.23 of its potential returns per unit of risk. Jia Jie Biomedical is currently generating about 0.13 per unit of risk. If you would invest 2,900 in BRIM Biotechnology on November 28, 2024 and sell it today you would earn a total of 115.00 from holding BRIM Biotechnology or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 55.56% |
| Values | Daily Returns |
BRIM Biotechnology vs. Jia Jie Biomedical
Performance |
| Timeline |
| BRIM Biotechnology |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Jia Jie Biomedical |
BRIM Biotechnology and Jia Jie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRIM Biotechnology and Jia Jie
The main advantage of trading using opposite BRIM Biotechnology and Jia Jie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRIM Biotechnology position performs unexpectedly, Jia Jie 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 Jia Jie will offset losses from the drop in Jia Jie's long position.| BRIM Biotechnology vs. Quang Viet Enterprise | BRIM Biotechnology vs. Li Peng Enterprise | BRIM Biotechnology vs. Shinkong Synthetic Fiber | BRIM Biotechnology vs. Evertex Fabrinology |
| Jia Jie vs. Healthconn Corp | Jia Jie vs. C Media Electronics | Jia Jie vs. WinMate Communication INC | Jia Jie vs. SS Healthcare Holding |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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