Correlation Between Bio Gene and Regal Funds
Can any of the company-specific risk be diversified away by investing in both Bio Gene and Regal Funds 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 Bio Gene and Regal Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bio Gene Technology and Regal Funds Management, you can compare the effects of market volatilities on Bio Gene and Regal Funds 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 Bio Gene with a short position of Regal Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bio Gene and Regal Funds.
Diversification Opportunities for Bio Gene and Regal Funds
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bio and Regal is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bio Gene Technology and Regal Funds Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Funds Management and Bio Gene 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 Bio Gene Technology are associated (or correlated) with Regal Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Funds Management has no effect on the direction of Bio Gene i.e., Bio Gene and Regal Funds go up and down completely randomly.
Pair Corralation between Bio Gene and Regal Funds
Assuming the 90 days trading horizon Bio Gene Technology is expected to under-perform the Regal Funds. In addition to that, Bio Gene is 2.73 times more volatile than Regal Funds Management. It trades about -0.12 of its total potential returns per unit of risk. Regal Funds Management is currently generating about 0.2 per unit of volatility. If you would invest 370.00 in Regal Funds Management on September 1, 2024 and sell it today you would earn a total of 33.00 from holding Regal Funds Management or generate 8.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bio Gene Technology vs. Regal Funds Management
Performance |
| Timeline |
| Bio Gene Technology |
| Regal Funds Management |
Bio Gene and Regal Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bio Gene and Regal Funds
The main advantage of trading using opposite Bio Gene and Regal Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bio Gene position performs unexpectedly, Regal Funds 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 Regal Funds will offset losses from the drop in Regal Funds' long position.| Bio Gene vs. Northern Star Resources | Bio Gene vs. Evolution Mining | Bio Gene vs. Bluescope Steel | Bio Gene vs. Sandfire Resources NL |
| Regal Funds vs. Ras Technology Holdings | Regal Funds vs. Macquarie Technology Group | Regal Funds vs. Bisalloy Steel Group | Regal Funds vs. Richmond Vanadium Technology |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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