Correlation Between Comba Telecom and WUXI BIOLOGICS
Can any of the company-specific risk be diversified away by investing in both Comba Telecom and WUXI BIOLOGICS 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 Comba Telecom and WUXI BIOLOGICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comba Telecom Systems and WUXI BIOLOGICS 00000083, you can compare the effects of market volatilities on Comba Telecom and WUXI BIOLOGICS 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 Comba Telecom with a short position of WUXI BIOLOGICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comba Telecom and WUXI BIOLOGICS.
Diversification Opportunities for Comba Telecom and WUXI BIOLOGICS
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Comba and WUXI is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Comba Telecom Systems and WUXI BIOLOGICS 00000083 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WUXI BIOLOGICS 00000083 and Comba Telecom 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 Comba Telecom Systems are associated (or correlated) with WUXI BIOLOGICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WUXI BIOLOGICS 00000083 has no effect on the direction of Comba Telecom i.e., Comba Telecom and WUXI BIOLOGICS go up and down completely randomly.
Pair Corralation between Comba Telecom and WUXI BIOLOGICS
Assuming the 90 days trading horizon Comba Telecom Systems is expected to generate 1.17 times more return on investment than WUXI BIOLOGICS. However, Comba Telecom is 1.17 times more volatile than WUXI BIOLOGICS 00000083. It trades about 0.02 of its potential returns per unit of risk. WUXI BIOLOGICS 00000083 is currently generating about -0.02 per unit of risk. If you would invest 13.00 in Comba Telecom Systems on September 12, 2024 and sell it today you would lose (2.00) from holding Comba Telecom Systems or give up 15.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Comba Telecom Systems vs. WUXI BIOLOGICS 00000083
Performance |
| Timeline |
| Comba Telecom Systems |
| WUXI BIOLOGICS 00000083 |
Comba Telecom and WUXI BIOLOGICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comba Telecom and WUXI BIOLOGICS
The main advantage of trading using opposite Comba Telecom and WUXI BIOLOGICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comba Telecom position performs unexpectedly, WUXI BIOLOGICS 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 WUXI BIOLOGICS will offset losses from the drop in WUXI BIOLOGICS's long position.| Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc |
| WUXI BIOLOGICS vs. HYDROFARM HLD GRP | WUXI BIOLOGICS vs. Citic Telecom International | WUXI BIOLOGICS vs. Consolidated Communications Holdings | WUXI BIOLOGICS vs. Comba Telecom Systems |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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