Correlation Between Access Bio and Ray
Can any of the company-specific risk be diversified away by investing in both Access Bio and Ray 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 Access Bio and Ray into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Access Bio and Ray Co, you can compare the effects of market volatilities on Access Bio and Ray 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 Access Bio with a short position of Ray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Access Bio and Ray.
Diversification Opportunities for Access Bio and Ray
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Access and Ray is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Access Bio and Ray Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ray Co and Access Bio 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 Access Bio are associated (or correlated) with Ray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ray Co has no effect on the direction of Access Bio i.e., Access Bio and Ray go up and down completely randomly.
Pair Corralation between Access Bio and Ray
Assuming the 90 days trading horizon Access Bio is expected to generate 1.11 times more return on investment than Ray. However, Access Bio is 1.11 times more volatile than Ray Co. It trades about -0.02 of its potential returns per unit of risk. Ray Co is currently generating about -0.07 per unit of risk. If you would invest 1,140,000 in Access Bio on September 1, 2024 and sell it today you would lose (586,000) from holding Access Bio or give up 51.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Access Bio vs. Ray Co
Performance |
| Timeline |
| Access Bio |
| Ray Co |
Access Bio and Ray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Access Bio and Ray
The main advantage of trading using opposite Access Bio and Ray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Access Bio position performs unexpectedly, Ray 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 Ray will offset losses from the drop in Ray's long position.| Access Bio vs. Iljin Display | Access Bio vs. Display Tech Co | Access Bio vs. Polaris Office Corp | Access Bio vs. Kaonmedia Co |
| Ray vs. Korean Air Lines | Ray vs. Koryo Credit Information | Ray vs. Dongbu Insurance Co | Ray vs. Total Soft Bank |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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