Correlation Between Posiflex Technology and Maxigen Biotech
Can any of the company-specific risk be diversified away by investing in both Posiflex Technology and Maxigen Biotech 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 Posiflex Technology and Maxigen Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Posiflex Technology and Maxigen Biotech, you can compare the effects of market volatilities on Posiflex Technology and Maxigen 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 Posiflex Technology with a short position of Maxigen Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Posiflex Technology and Maxigen Biotech.
Diversification Opportunities for Posiflex Technology and Maxigen Biotech
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Posiflex and Maxigen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Posiflex Technology and Maxigen Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maxigen Biotech and Posiflex Technology 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 Posiflex Technology are associated (or correlated) with Maxigen Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maxigen Biotech has no effect on the direction of Posiflex Technology i.e., Posiflex Technology and Maxigen Biotech go up and down completely randomly.
Pair Corralation between Posiflex Technology and Maxigen Biotech
Assuming the 90 days trading horizon Posiflex Technology is expected to generate 9.46 times less return on investment than Maxigen Biotech. In addition to that, Posiflex Technology is 1.74 times more volatile than Maxigen Biotech. It trades about 0.01 of its total potential returns per unit of risk. Maxigen Biotech is currently generating about 0.23 per unit of volatility. If you would invest 4,840 in Maxigen Biotech on October 13, 2024 and sell it today you would earn a total of 330.00 from holding Maxigen Biotech or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Posiflex Technology vs. Maxigen Biotech
Performance |
| Timeline |
| Posiflex Technology |
| Maxigen Biotech |
Posiflex Technology and Maxigen Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Posiflex Technology and Maxigen Biotech
The main advantage of trading using opposite Posiflex Technology and Maxigen Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Posiflex Technology position performs unexpectedly, Maxigen 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 Maxigen Biotech will offset losses from the drop in Maxigen Biotech's long position.| Posiflex Technology vs. Flytech Technology Co | Posiflex Technology vs. Advantech Co | Posiflex Technology vs. Ennoconn Corp | Posiflex Technology vs. Chenbro Micom Co |
| Maxigen Biotech vs. Phytohealth Corp | Maxigen Biotech vs. Yung Zip Chemical | Maxigen Biotech vs. Information Technology Total | Maxigen Biotech vs. Kinko Optical Co |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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