Correlation Between Kip McGrath and Bio Gene
Can any of the company-specific risk be diversified away by investing in both Kip McGrath and Bio Gene 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 Kip McGrath and Bio Gene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kip McGrath Education and Bio Gene Technology, you can compare the effects of market volatilities on Kip McGrath and Bio Gene 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 Kip McGrath with a short position of Bio Gene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kip McGrath and Bio Gene.
Diversification Opportunities for Kip McGrath and Bio Gene
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kip and Bio is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Kip McGrath Education and Bio Gene Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Gene Technology and Kip McGrath 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 Kip McGrath Education are associated (or correlated) with Bio Gene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Gene Technology has no effect on the direction of Kip McGrath i.e., Kip McGrath and Bio Gene go up and down completely randomly.
Pair Corralation between Kip McGrath and Bio Gene
Assuming the 90 days trading horizon Kip McGrath Education is expected to under-perform the Bio Gene. But the stock apears to be less risky and, when comparing its historical volatility, Kip McGrath Education is 10.9 times less risky than Bio Gene. The stock trades about -0.06 of its potential returns per unit of risk. The Bio Gene Technology is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 4.30 in Bio Gene Technology on November 3, 2024 and sell it today you would earn a total of 0.60 from holding Bio Gene Technology or generate 13.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kip McGrath Education vs. Bio Gene Technology
Performance |
| Timeline |
| Kip McGrath Education |
| Bio Gene Technology |
Kip McGrath and Bio Gene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kip McGrath and Bio Gene
The main advantage of trading using opposite Kip McGrath and Bio Gene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kip McGrath position performs unexpectedly, Bio Gene 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 Bio Gene will offset losses from the drop in Bio Gene's long position.| Kip McGrath vs. MetalsGrove Mining | Kip McGrath vs. Black Rock Mining | Kip McGrath vs. Chalice Mining Limited | Kip McGrath vs. Collins Foods |
| Bio Gene vs. Galena Mining | Bio Gene vs. Infomedia | Bio Gene vs. MotorCycle Holdings | Bio Gene vs. ARN Media Limited |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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