Correlation Between Tanke Biosciences and A1
Can any of the company-specific risk be diversified away by investing in both Tanke Biosciences and A1 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 Tanke Biosciences and A1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tanke Biosciences and A1 Group, you can compare the effects of market volatilities on Tanke Biosciences and A1 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 Tanke Biosciences with a short position of A1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanke Biosciences and A1.
Diversification Opportunities for Tanke Biosciences and A1
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Tanke and A1 is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Tanke Biosciences and A1 Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A1 Group and Tanke Biosciences 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 Tanke Biosciences are associated (or correlated) with A1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A1 Group has no effect on the direction of Tanke Biosciences i.e., Tanke Biosciences and A1 go up and down completely randomly.
Pair Corralation between Tanke Biosciences and A1
Given the investment horizon of 90 days Tanke Biosciences is expected to generate 0.24 times more return on investment than A1. However, Tanke Biosciences is 4.21 times less risky than A1. It trades about -0.21 of its potential returns per unit of risk. A1 Group is currently generating about -0.07 per unit of risk. If you would invest 1.00 in Tanke Biosciences on September 1, 2024 and sell it today you would lose (0.24) from holding Tanke Biosciences or give up 24.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Tanke Biosciences vs. A1 Group
Performance |
| Timeline |
| Tanke Biosciences |
| A1 Group |
Tanke Biosciences and A1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tanke Biosciences and A1
The main advantage of trading using opposite Tanke Biosciences and A1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tanke Biosciences position performs unexpectedly, A1 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 A1 will offset losses from the drop in A1's long position.| Tanke Biosciences vs. C2E Energy | Tanke Biosciences vs. Supurva Healthcare Group | Tanke Biosciences vs. Kasten Inc | Tanke Biosciences vs. CTR Investments Consulting |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |