Correlation Between Identiv and CanSino Biologics
Can any of the company-specific risk be diversified away by investing in both Identiv and CanSino 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 Identiv and CanSino Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Identiv and CanSino Biologics, you can compare the effects of market volatilities on Identiv and CanSino 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 Identiv with a short position of CanSino Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identiv and CanSino Biologics.
Diversification Opportunities for Identiv and CanSino Biologics
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Identiv and CanSino is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and CanSino Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanSino Biologics and Identiv 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 Identiv are associated (or correlated) with CanSino Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanSino Biologics has no effect on the direction of Identiv i.e., Identiv and CanSino Biologics go up and down completely randomly.
Pair Corralation between Identiv and CanSino Biologics
Assuming the 90 days trading horizon Identiv is expected to under-perform the CanSino Biologics. But the stock apears to be less risky and, when comparing its historical volatility, Identiv is 1.16 times less risky than CanSino Biologics. The stock trades about -0.03 of its potential returns per unit of risk. The CanSino Biologics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 242.00 in CanSino Biologics on September 3, 2024 and sell it today you would earn a total of 94.00 from holding CanSino Biologics or generate 38.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Identiv vs. CanSino Biologics
Performance |
| Timeline |
| Identiv |
| CanSino Biologics |
Identiv and CanSino Biologics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Identiv and CanSino Biologics
The main advantage of trading using opposite Identiv and CanSino Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identiv position performs unexpectedly, CanSino 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 CanSino Biologics will offset losses from the drop in CanSino Biologics' long position.| Identiv vs. Hitachi Construction Machinery | Identiv vs. Sumitomo Mitsui Construction | Identiv vs. Marie Brizard Wine | Identiv vs. HYDROFARM HLD GRP |
| CanSino Biologics vs. Merck KGaA | CanSino Biologics vs. Superior Plus Corp | CanSino Biologics vs. NMI Holdings | CanSino Biologics vs. Origin Agritech |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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