Correlation Between Nano Labs and GSI Technology
Can any of the company-specific risk be diversified away by investing in both Nano Labs and GSI 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 Nano Labs and GSI Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nano Labs and GSI Technology, you can compare the effects of market volatilities on Nano Labs and GSI 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 Nano Labs with a short position of GSI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nano Labs and GSI Technology.
Diversification Opportunities for Nano Labs and GSI Technology
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nano and GSI is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Nano Labs and GSI Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GSI Technology and Nano Labs 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 Nano Labs are associated (or correlated) with GSI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GSI Technology has no effect on the direction of Nano Labs i.e., Nano Labs and GSI Technology go up and down completely randomly.
Pair Corralation between Nano Labs and GSI Technology
Allowing for the 90-day total investment horizon Nano Labs is expected to generate 1.99 times more return on investment than GSI Technology. However, Nano Labs is 1.99 times more volatile than GSI Technology. It trades about 0.03 of its potential returns per unit of risk. GSI Technology is currently generating about 0.0 per unit of risk. If you would invest 2,100 in Nano Labs on August 28, 2024 and sell it today you would lose (1,261) from holding Nano Labs or give up 60.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nano Labs vs. GSI Technology
Performance |
| Timeline |
| Nano Labs |
| GSI Technology |
Nano Labs and GSI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nano Labs and GSI Technology
The main advantage of trading using opposite Nano Labs and GSI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nano Labs position performs unexpectedly, GSI 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 GSI Technology will offset losses from the drop in GSI Technology's long position.| Nano Labs vs. SEALSQ Corp | Nano Labs vs. GSI Technology | Nano Labs vs. SemiLEDS | Nano Labs vs. ChipMOS Technologies |
| GSI Technology vs. SEALSQ Corp | GSI Technology vs. Nano Labs | GSI Technology vs. SemiLEDS | GSI Technology vs. Wisekey International Holding |
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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