Correlation Between Access Bio and Sugentech
Can any of the company-specific risk be diversified away by investing in both Access Bio and Sugentech 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 Sugentech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Access Bio and Sugentech, you can compare the effects of market volatilities on Access Bio and Sugentech 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 Sugentech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Access Bio and Sugentech.
Diversification Opportunities for Access Bio and Sugentech
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Access and Sugentech is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Access Bio and Sugentech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sugentech 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 Sugentech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sugentech has no effect on the direction of Access Bio i.e., Access Bio and Sugentech go up and down completely randomly.
Pair Corralation between Access Bio and Sugentech
Assuming the 90 days trading horizon Access Bio is expected to under-perform the Sugentech. But the stock apears to be less risky and, when comparing its historical volatility, Access Bio is 1.03 times less risky than Sugentech. The stock trades about -0.06 of its potential returns per unit of risk. The Sugentech is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 590,000 in Sugentech on August 29, 2024 and sell it today you would lose (15,000) from holding Sugentech or give up 2.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Access Bio vs. Sugentech
Performance |
| Timeline |
| Access Bio |
| Sugentech |
Access Bio and Sugentech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Access Bio and Sugentech
The main advantage of trading using opposite Access Bio and Sugentech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Access Bio position performs unexpectedly, Sugentech 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 Sugentech will offset losses from the drop in Sugentech's long position.| Access Bio vs. DC Media Co | Access Bio vs. T3 Entertainment Co | Access Bio vs. Hyundai Home Shopping | Access Bio vs. SM Entertainment 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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