Correlation Between CHEMICAL INDUSTRIES and Lion Biotechnologies
Can any of the company-specific risk be diversified away by investing in both CHEMICAL INDUSTRIES and Lion Biotechnologies 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 CHEMICAL INDUSTRIES and Lion Biotechnologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHEMICAL INDUSTRIES and Lion Biotechnologies, you can compare the effects of market volatilities on CHEMICAL INDUSTRIES and Lion Biotechnologies 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 CHEMICAL INDUSTRIES with a short position of Lion Biotechnologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHEMICAL INDUSTRIES and Lion Biotechnologies.
Diversification Opportunities for CHEMICAL INDUSTRIES and Lion Biotechnologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHEMICAL and Lion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHEMICAL INDUSTRIES and Lion Biotechnologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Biotechnologies and CHEMICAL INDUSTRIES 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 CHEMICAL INDUSTRIES are associated (or correlated) with Lion Biotechnologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Biotechnologies has no effect on the direction of CHEMICAL INDUSTRIES i.e., CHEMICAL INDUSTRIES and Lion Biotechnologies go up and down completely randomly.
Pair Corralation between CHEMICAL INDUSTRIES and Lion Biotechnologies
If you would invest 43.00 in CHEMICAL INDUSTRIES on October 15, 2024 and sell it today you would earn a total of 0.00 from holding CHEMICAL INDUSTRIES or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 93.75% |
| Values | Daily Returns |
CHEMICAL INDUSTRIES vs. Lion Biotechnologies
Performance |
| Timeline |
| CHEMICAL INDUSTRIES |
| Lion Biotechnologies |
CHEMICAL INDUSTRIES and Lion Biotechnologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHEMICAL INDUSTRIES and Lion Biotechnologies
The main advantage of trading using opposite CHEMICAL INDUSTRIES and Lion Biotechnologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHEMICAL INDUSTRIES position performs unexpectedly, Lion Biotechnologies 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 Lion Biotechnologies will offset losses from the drop in Lion Biotechnologies' long position.| CHEMICAL INDUSTRIES vs. GLOBUS MEDICAL A | CHEMICAL INDUSTRIES vs. ONWARD MEDICAL BV | CHEMICAL INDUSTRIES vs. CompuGroup Medical SE | CHEMICAL INDUSTRIES vs. MOVIE GAMES SA |
| Lion Biotechnologies vs. KINGBOARD CHEMICAL | Lion Biotechnologies vs. GRUPO CARSO A1 | Lion Biotechnologies vs. CHEMICAL INDUSTRIES | Lion Biotechnologies vs. Grupo Carso SAB |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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