Correlation Between Futuretech and Intelligent Bio
Can any of the company-specific risk be diversified away by investing in both Futuretech and Intelligent Bio 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 Futuretech and Intelligent Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Futuretech II Acquisition and Intelligent Bio Solutions, you can compare the effects of market volatilities on Futuretech and Intelligent Bio 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 Futuretech with a short position of Intelligent Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Futuretech and Intelligent Bio.
Diversification Opportunities for Futuretech and Intelligent Bio
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Futuretech and Intelligent is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Futuretech II Acquisition and Intelligent Bio Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelligent Bio Solutions and Futuretech 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 Futuretech II Acquisition are associated (or correlated) with Intelligent Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelligent Bio Solutions has no effect on the direction of Futuretech i.e., Futuretech and Intelligent Bio go up and down completely randomly.
Pair Corralation between Futuretech and Intelligent Bio
Given the investment horizon of 90 days Futuretech II Acquisition is expected to generate 0.21 times more return on investment than Intelligent Bio. However, Futuretech II Acquisition is 4.82 times less risky than Intelligent Bio. It trades about 0.02 of its potential returns per unit of risk. Intelligent Bio Solutions is currently generating about -0.02 per unit of risk. If you would invest 1,113 in Futuretech II Acquisition on December 5, 2024 and sell it today you would earn a total of 65.00 from holding Futuretech II Acquisition or generate 5.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Futuretech II Acquisition vs. Intelligent Bio Solutions
Performance |
| Timeline |
| Futuretech II Acquisition |
| Intelligent Bio Solutions |
Futuretech and Intelligent Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Futuretech and Intelligent Bio
The main advantage of trading using opposite Futuretech and Intelligent Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Futuretech position performs unexpectedly, Intelligent Bio 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 Intelligent Bio will offset losses from the drop in Intelligent Bio's long position.| Futuretech vs. Manaris Corp | ||
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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