Correlation Between Genetron Holdings and Star Equity
Can any of the company-specific risk be diversified away by investing in both Genetron Holdings and Star Equity 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 Genetron Holdings and Star Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genetron Holdings and Star Equity Holdings, you can compare the effects of market volatilities on Genetron Holdings and Star Equity 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 Genetron Holdings with a short position of Star Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genetron Holdings and Star Equity.
Diversification Opportunities for Genetron Holdings and Star Equity
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Genetron and Star is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Genetron Holdings and Star Equity Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Star Equity Holdings and Genetron Holdings 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 Genetron Holdings are associated (or correlated) with Star Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Star Equity Holdings has no effect on the direction of Genetron Holdings i.e., Genetron Holdings and Star Equity go up and down completely randomly.
Pair Corralation between Genetron Holdings and Star Equity
Considering the 90-day investment horizon Genetron Holdings is expected to under-perform the Star Equity. In addition to that, Genetron Holdings is 1.03 times more volatile than Star Equity Holdings. It trades about -0.01 of its total potential returns per unit of risk. Star Equity Holdings is currently generating about 0.03 per unit of volatility. If you would invest 820.00 in Star Equity Holdings on August 30, 2024 and sell it today you would earn a total of 122.00 from holding Star Equity Holdings or generate 14.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.31% |
| Values | Daily Returns |
Genetron Holdings vs. Star Equity Holdings
Performance |
| Timeline |
| Genetron Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Star Equity Holdings |
Genetron Holdings and Star Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genetron Holdings and Star Equity
The main advantage of trading using opposite Genetron Holdings and Star Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genetron Holdings position performs unexpectedly, Star Equity 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 Star Equity will offset losses from the drop in Star Equity's long position.| Genetron Holdings vs. Psychemedics | Genetron Holdings vs. Sera Prognostics | Genetron Holdings vs. DarioHealth Corp | Genetron Holdings vs. Biodesix |
| Star Equity vs. Star Equity Holdings | Star Equity vs. XOMA Corp | Star Equity vs. Fundamental Global | Star Equity vs. Fortress Biotech Pref |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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