Correlation Between GEAR4MUSIC and WUXI BIOLOGICS
Can any of the company-specific risk be diversified away by investing in both GEAR4MUSIC 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 GEAR4MUSIC and WUXI BIOLOGICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEAR4MUSIC LS 10 and WUXI BIOLOGICS 00000083, you can compare the effects of market volatilities on GEAR4MUSIC 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 GEAR4MUSIC with a short position of WUXI BIOLOGICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEAR4MUSIC and WUXI BIOLOGICS.
Diversification Opportunities for GEAR4MUSIC and WUXI BIOLOGICS
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between GEAR4MUSIC and WUXI is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GEAR4MUSIC LS 10 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 GEAR4MUSIC 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 GEAR4MUSIC LS 10 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 GEAR4MUSIC i.e., GEAR4MUSIC and WUXI BIOLOGICS go up and down completely randomly.
Pair Corralation between GEAR4MUSIC and WUXI BIOLOGICS
Assuming the 90 days horizon GEAR4MUSIC LS 10 is expected to generate 0.67 times more return on investment than WUXI BIOLOGICS. However, GEAR4MUSIC LS 10 is 1.48 times less risky than WUXI BIOLOGICS. It trades about 0.06 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 114.00 in GEAR4MUSIC LS 10 on September 12, 2024 and sell it today you would earn a total of 79.00 from holding GEAR4MUSIC LS 10 or generate 69.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
GEAR4MUSIC LS 10 vs. WUXI BIOLOGICS 00000083
Performance |
| Timeline |
| GEAR4MUSIC LS 10 |
| WUXI BIOLOGICS 00000083 |
GEAR4MUSIC and WUXI BIOLOGICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEAR4MUSIC and WUXI BIOLOGICS
The main advantage of trading using opposite GEAR4MUSIC and WUXI BIOLOGICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEAR4MUSIC 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.| GEAR4MUSIC vs. PARKEN Sport Entertainment | GEAR4MUSIC vs. LG Display Co | GEAR4MUSIC vs. JD SPORTS FASH | GEAR4MUSIC vs. PLAYTIKA HOLDING DL 01 |
| 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |