Correlation Between Genesis Fertility and Dexon Technology
Can any of the company-specific risk be diversified away by investing in both Genesis Fertility and Dexon Technology 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 Genesis Fertility and Dexon Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genesis Fertility Center and Dexon Technology PCL, you can compare the effects of market volatilities on Genesis Fertility and Dexon Technology 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 Genesis Fertility with a short position of Dexon Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genesis Fertility and Dexon Technology.
Diversification Opportunities for Genesis Fertility and Dexon Technology
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Genesis and Dexon is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Genesis Fertility Center and Dexon Technology PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dexon Technology PCL and Genesis Fertility 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 Genesis Fertility Center are associated (or correlated) with Dexon Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dexon Technology PCL has no effect on the direction of Genesis Fertility i.e., Genesis Fertility and Dexon Technology go up and down completely randomly.
Pair Corralation between Genesis Fertility and Dexon Technology
Assuming the 90 days trading horizon Genesis Fertility is expected to generate 1.2 times less return on investment than Dexon Technology. But when comparing it to its historical volatility, Genesis Fertility Center is 2.67 times less risky than Dexon Technology. It trades about 0.15 of its potential returns per unit of risk. Dexon Technology PCL is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 146.00 in Dexon Technology PCL on October 21, 2024 and sell it today you would earn a total of 6.00 from holding Dexon Technology PCL or generate 4.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genesis Fertility Center vs. Dexon Technology PCL
Performance |
| Timeline |
| Genesis Fertility Center |
| Dexon Technology PCL |
Genesis Fertility and Dexon Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genesis Fertility and Dexon Technology
The main advantage of trading using opposite Genesis Fertility and Dexon Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genesis Fertility position performs unexpectedly, Dexon Technology 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 Dexon Technology will offset losses from the drop in Dexon Technology's long position.| Genesis Fertility vs. Dexon Technology PCL | Genesis Fertility vs. Digital Telecommunications Infrastructure | Genesis Fertility vs. President Automobile Industries | Genesis Fertility vs. Rich Sport Public |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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