Correlation Between Burning Rock and Rushnet
Can any of the company-specific risk be diversified away by investing in both Burning Rock and Rushnet 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 Burning Rock and Rushnet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burning Rock Biotech and Rushnet, you can compare the effects of market volatilities on Burning Rock and Rushnet 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 Burning Rock with a short position of Rushnet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burning Rock and Rushnet.
Diversification Opportunities for Burning Rock and Rushnet
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Burning and Rushnet is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Burning Rock Biotech and Rushnet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rushnet and Burning Rock 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 Burning Rock Biotech are associated (or correlated) with Rushnet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rushnet has no effect on the direction of Burning Rock i.e., Burning Rock and Rushnet go up and down completely randomly.
Pair Corralation between Burning Rock and Rushnet
Considering the 90-day investment horizon Burning Rock is expected to generate 115.42 times less return on investment than Rushnet. But when comparing it to its historical volatility, Burning Rock Biotech is 10.57 times less risky than Rushnet. It trades about 0.01 of its potential returns per unit of risk. Rushnet is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.02 in Rushnet on October 21, 2024 and sell it today you would lose (0.01) from holding Rushnet or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Burning Rock Biotech vs. Rushnet
Performance |
| Timeline |
| Burning Rock Biotech |
| Rushnet |
Burning Rock and Rushnet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burning Rock and Rushnet
The main advantage of trading using opposite Burning Rock and Rushnet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burning Rock position performs unexpectedly, Rushnet 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 Rushnet will offset losses from the drop in Rushnet's long position.| Burning Rock vs. Fonar | Burning Rock vs. Sera Prognostics | Burning Rock vs. Neuronetics | Burning Rock vs. DarioHealth Corp |
| Rushnet vs. HPIL Holding | Rushnet vs. KYN Capital Group | Rushnet vs. Probility Media Corp | Rushnet vs. Majic Wheels Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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