Correlation Between Sino Biopharmaceutica and Oxford Cannabinoid
Can any of the company-specific risk be diversified away by investing in both Sino Biopharmaceutica and Oxford Cannabinoid 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 Oxford Cannabinoid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sino Biopharmaceutical Limited and Oxford Cannabinoid Technologies, you can compare the effects of market volatilities on Sino Biopharmaceutica and Oxford Cannabinoid 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 Oxford Cannabinoid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sino Biopharmaceutica and Oxford Cannabinoid.
Diversification Opportunities for Sino Biopharmaceutica and Oxford Cannabinoid
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sino and Oxford is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sino Biopharmaceutical Limited and Oxford Cannabinoid Technologie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Cannabinoid 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 Limited are associated (or correlated) with Oxford Cannabinoid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Cannabinoid has no effect on the direction of Sino Biopharmaceutica i.e., Sino Biopharmaceutica and Oxford Cannabinoid go up and down completely randomly.
Pair Corralation between Sino Biopharmaceutica and Oxford Cannabinoid
Assuming the 90 days horizon Sino Biopharmaceutica is expected to generate 17.14 times less return on investment than Oxford Cannabinoid. But when comparing it to its historical volatility, Sino Biopharmaceutical Limited is 6.4 times less risky than Oxford Cannabinoid. It trades about 0.01 of its potential returns per unit of risk. Oxford Cannabinoid Technologies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 0.51 in Oxford Cannabinoid Technologies on September 2, 2024 and sell it today you would lose (0.23) from holding Oxford Cannabinoid Technologies or give up 45.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 62.1% |
| Values | Daily Returns |
Sino Biopharmaceutical Limited vs. Oxford Cannabinoid Technologie
Performance |
| Timeline |
| Sino Biopharmaceutical |
| Oxford Cannabinoid |
Sino Biopharmaceutica and Oxford Cannabinoid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sino Biopharmaceutica and Oxford Cannabinoid
The main advantage of trading using opposite Sino Biopharmaceutica and Oxford Cannabinoid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sino Biopharmaceutica position performs unexpectedly, Oxford Cannabinoid 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 Oxford Cannabinoid will offset losses from the drop in Oxford Cannabinoid's long position.| Sino Biopharmaceutica vs. Rigel Pharmaceuticals | Sino Biopharmaceutica vs. Geron | Sino Biopharmaceutica vs. Verastem | Sino Biopharmaceutica vs. Immutep Ltd ADR |
| Oxford Cannabinoid vs. Rigel Pharmaceuticals | Oxford Cannabinoid vs. Geron | Oxford Cannabinoid vs. Verastem | Oxford Cannabinoid 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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