Correlation Between VITEC SOFTWARE and CanSino Biologics
Can any of the company-specific risk be diversified away by investing in both VITEC SOFTWARE and CanSino Biologics 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 VITEC SOFTWARE and CanSino Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VITEC SOFTWARE GROUP and CanSino Biologics, you can compare the effects of market volatilities on VITEC SOFTWARE and CanSino Biologics 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 VITEC SOFTWARE with a short position of CanSino Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of VITEC SOFTWARE and CanSino Biologics.
Diversification Opportunities for VITEC SOFTWARE and CanSino Biologics
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between VITEC and CanSino is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding VITEC SOFTWARE GROUP and CanSino Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanSino Biologics and VITEC SOFTWARE 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 VITEC SOFTWARE GROUP are associated (or correlated) with CanSino Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanSino Biologics has no effect on the direction of VITEC SOFTWARE i.e., VITEC SOFTWARE and CanSino Biologics go up and down completely randomly.
Pair Corralation between VITEC SOFTWARE and CanSino Biologics
Assuming the 90 days horizon VITEC SOFTWARE GROUP is expected to generate 0.58 times more return on investment than CanSino Biologics. However, VITEC SOFTWARE GROUP is 1.74 times less risky than CanSino Biologics. It trades about 0.03 of its potential returns per unit of risk. CanSino Biologics is currently generating about -0.02 per unit of risk. If you would invest 3,584 in VITEC SOFTWARE GROUP on October 19, 2024 and sell it today you would earn a total of 1,038 from holding VITEC SOFTWARE GROUP or generate 28.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VITEC SOFTWARE GROUP vs. CanSino Biologics
Performance |
| Timeline |
| VITEC SOFTWARE GROUP |
| CanSino Biologics |
VITEC SOFTWARE and CanSino Biologics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VITEC SOFTWARE and CanSino Biologics
The main advantage of trading using opposite VITEC SOFTWARE and CanSino Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VITEC SOFTWARE position performs unexpectedly, CanSino Biologics 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 CanSino Biologics will offset losses from the drop in CanSino Biologics' long position.| VITEC SOFTWARE vs. Wayside Technology Group | VITEC SOFTWARE vs. Sunny Optical Technology | VITEC SOFTWARE vs. AECOM TECHNOLOGY | VITEC SOFTWARE vs. Ubisoft Entertainment SA |
| CanSino Biologics vs. USU Software AG | CanSino Biologics vs. VITEC SOFTWARE GROUP | CanSino Biologics vs. Sumitomo Rubber Industries | CanSino Biologics vs. Applied Materials |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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