Correlation Between Slang Worldwide and Athenex
Can any of the company-specific risk be diversified away by investing in both Slang Worldwide and Athenex 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 Slang Worldwide and Athenex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slang Worldwide and Athenex, you can compare the effects of market volatilities on Slang Worldwide and Athenex 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 Slang Worldwide with a short position of Athenex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slang Worldwide and Athenex.
Diversification Opportunities for Slang Worldwide and Athenex
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Slang and Athenex is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Slang Worldwide and Athenex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athenex and Slang Worldwide 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 Slang Worldwide are associated (or correlated) with Athenex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athenex has no effect on the direction of Slang Worldwide i.e., Slang Worldwide and Athenex go up and down completely randomly.
Pair Corralation between Slang Worldwide and Athenex
If you would invest 0.50 in Slang Worldwide on August 28, 2024 and sell it today you would lose (0.19) from holding Slang Worldwide or give up 38.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Slang Worldwide vs. Athenex
Performance |
| Timeline |
| Slang Worldwide |
| Athenex |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Slang Worldwide and Athenex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slang Worldwide and Athenex
The main advantage of trading using opposite Slang Worldwide and Athenex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slang Worldwide position performs unexpectedly, Athenex 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 Athenex will offset losses from the drop in Athenex's long position.The idea behind Slang Worldwide and Athenex pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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