Correlation Between PureTech Health and Sino Biopharmaceutica
Can any of the company-specific risk be diversified away by investing in both PureTech Health and Sino Biopharmaceutica 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 PureTech Health and Sino Biopharmaceutica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PureTech Health plc and Sino Biopharmaceutical Limited, you can compare the effects of market volatilities on PureTech Health and Sino Biopharmaceutica 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 PureTech Health with a short position of Sino Biopharmaceutica. Check out your portfolio center. Please also check ongoing floating volatility patterns of PureTech Health and Sino Biopharmaceutica.
Diversification Opportunities for PureTech Health and Sino Biopharmaceutica
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PureTech and Sino is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding PureTech Health plc and Sino Biopharmaceutical Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sino Biopharmaceutical and PureTech Health 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 PureTech Health plc are associated (or correlated) with Sino Biopharmaceutica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sino Biopharmaceutical has no effect on the direction of PureTech Health i.e., PureTech Health and Sino Biopharmaceutica go up and down completely randomly.
Pair Corralation between PureTech Health and Sino Biopharmaceutica
If you would invest 33.00 in Sino Biopharmaceutical Limited on September 1, 2024 and sell it today you would earn a total of 9.00 from holding Sino Biopharmaceutical Limited or generate 27.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.76% |
| Values | Daily Returns |
PureTech Health plc vs. Sino Biopharmaceutical Limited
Performance |
| Timeline |
| PureTech Health plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Sino Biopharmaceutical |
PureTech Health and Sino Biopharmaceutica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PureTech Health and Sino Biopharmaceutica
The main advantage of trading using opposite PureTech Health and Sino Biopharmaceutica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PureTech Health position performs unexpectedly, Sino Biopharmaceutica 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 Sino Biopharmaceutica will offset losses from the drop in Sino Biopharmaceutica's long position.| PureTech Health vs. Apellis Pharmaceuticals | PureTech Health vs. Terns Pharmaceuticals | PureTech Health vs. Day One Biopharmaceuticals | PureTech Health vs. Blueprint Medicines Corp |
| Sino Biopharmaceutica vs. Rigel Pharmaceuticals | Sino Biopharmaceutica vs. Geron | Sino Biopharmaceutica vs. Verastem | Sino Biopharmaceutica vs. Immutep Ltd ADR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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