Correlation Between Sino Biopharmaceutica and Gemina Laboratories
Can any of the company-specific risk be diversified away by investing in both Sino Biopharmaceutica and Gemina Laboratories 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 Sino Biopharmaceutica and Gemina Laboratories into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sino Biopharmaceutical Ltd and Gemina Laboratories, you can compare the effects of market volatilities on Sino Biopharmaceutica and Gemina Laboratories 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 Sino Biopharmaceutica with a short position of Gemina Laboratories. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sino Biopharmaceutica and Gemina Laboratories.
Diversification Opportunities for Sino Biopharmaceutica and Gemina Laboratories
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sino and Gemina is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sino Biopharmaceutical Ltd and Gemina Laboratories in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gemina Laboratories and Sino Biopharmaceutica 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 Sino Biopharmaceutical Ltd are associated (or correlated) with Gemina Laboratories. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gemina Laboratories has no effect on the direction of Sino Biopharmaceutica i.e., Sino Biopharmaceutica and Gemina Laboratories go up and down completely randomly.
Pair Corralation between Sino Biopharmaceutica and Gemina Laboratories
Assuming the 90 days horizon Sino Biopharmaceutica is expected to generate 4.18 times less return on investment than Gemina Laboratories. But when comparing it to its historical volatility, Sino Biopharmaceutical Ltd is 2.61 times less risky than Gemina Laboratories. It trades about 0.1 of its potential returns per unit of risk. Gemina Laboratories is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 35.00 in Gemina Laboratories on September 13, 2024 and sell it today you would earn a total of 20.00 from holding Gemina Laboratories or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sino Biopharmaceutical Ltd vs. Gemina Laboratories
Performance |
| Timeline |
| Sino Biopharmaceutical |
| Gemina Laboratories |
Sino Biopharmaceutica and Gemina Laboratories Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sino Biopharmaceutica and Gemina Laboratories
The main advantage of trading using opposite Sino Biopharmaceutica and Gemina Laboratories positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sino Biopharmaceutica position performs unexpectedly, Gemina Laboratories 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 Gemina Laboratories will offset losses from the drop in Gemina Laboratories' long position.| Sino Biopharmaceutica vs. Institute of Biomedical | Sino Biopharmaceutica vs. Defence Therapeutics | Sino Biopharmaceutica vs. Aileron Therapeutics | Sino Biopharmaceutica vs. Enlivex Therapeutics |
| Gemina Laboratories vs. Novo Nordisk AS | Gemina Laboratories vs. Genmab AS | Gemina Laboratories vs. Inhibikase Therapeutics | Gemina Laboratories vs. Purple Biotech |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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