Correlation Between CanSino Biologics and Axway Software
Can any of the company-specific risk be diversified away by investing in both CanSino Biologics and Axway Software 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 CanSino Biologics and Axway Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CanSino Biologics and Axway Software SA, you can compare the effects of market volatilities on CanSino Biologics and Axway Software 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 CanSino Biologics with a short position of Axway Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of CanSino Biologics and Axway Software.
Diversification Opportunities for CanSino Biologics and Axway Software
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CanSino and Axway is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding CanSino Biologics and Axway Software SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axway Software SA and CanSino Biologics 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 CanSino Biologics are associated (or correlated) with Axway Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axway Software SA has no effect on the direction of CanSino Biologics i.e., CanSino Biologics and Axway Software go up and down completely randomly.
Pair Corralation between CanSino Biologics and Axway Software
Assuming the 90 days trading horizon CanSino Biologics is expected to under-perform the Axway Software. In addition to that, CanSino Biologics is 2.55 times more volatile than Axway Software SA. It trades about -0.28 of its total potential returns per unit of risk. Axway Software SA is currently generating about 0.01 per unit of volatility. If you would invest 2,680 in Axway Software SA on October 13, 2024 and sell it today you would earn a total of 0.00 from holding Axway Software SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CanSino Biologics vs. Axway Software SA
Performance |
| Timeline |
| CanSino Biologics |
| Axway Software SA |
CanSino Biologics and Axway Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CanSino Biologics and Axway Software
The main advantage of trading using opposite CanSino Biologics and Axway Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CanSino Biologics position performs unexpectedly, Axway Software 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 Axway Software will offset losses from the drop in Axway Software's long position.| CanSino Biologics vs. Perdoceo Education | CanSino Biologics vs. Cleanaway Waste Management | CanSino Biologics vs. Kingdee International Software | CanSino Biologics vs. ORMAT TECHNOLOGIES |
| Axway Software vs. CanSino Biologics | Axway Software vs. Entravision Communications | Axway Software vs. ETFS Coffee ETC | Axway Software vs. ScanSource |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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