Correlation Between SENECA FOODS-A and ZYMEWORKS DL-00001
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and ZYMEWORKS DL-00001 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 SENECA FOODS-A and ZYMEWORKS DL-00001 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SENECA FOODS A and ZYMEWORKS DL 00001, you can compare the effects of market volatilities on SENECA FOODS-A and ZYMEWORKS DL-00001 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 SENECA FOODS-A with a short position of ZYMEWORKS DL-00001. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and ZYMEWORKS DL-00001.
Diversification Opportunities for SENECA FOODS-A and ZYMEWORKS DL-00001
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SENECA and ZYMEWORKS is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and ZYMEWORKS DL 00001 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZYMEWORKS DL 00001 and SENECA FOODS-A 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 SENECA FOODS A are associated (or correlated) with ZYMEWORKS DL-00001. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZYMEWORKS DL 00001 has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and ZYMEWORKS DL-00001 go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and ZYMEWORKS DL-00001
Assuming the 90 days trading horizon SENECA FOODS-A is expected to generate 3.3 times less return on investment than ZYMEWORKS DL-00001. But when comparing it to its historical volatility, SENECA FOODS A is 1.17 times less risky than ZYMEWORKS DL-00001. It trades about 0.02 of its potential returns per unit of risk. ZYMEWORKS DL 00001 is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 558.00 in ZYMEWORKS DL 00001 on September 3, 2024 and sell it today you would earn a total of 772.00 from holding ZYMEWORKS DL 00001 or generate 138.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. ZYMEWORKS DL 00001
Performance |
| Timeline |
| SENECA FOODS A |
| ZYMEWORKS DL 00001 |
SENECA FOODS-A and ZYMEWORKS DL-00001 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and ZYMEWORKS DL-00001
The main advantage of trading using opposite SENECA FOODS-A and ZYMEWORKS DL-00001 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, ZYMEWORKS DL-00001 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 ZYMEWORKS DL-00001 will offset losses from the drop in ZYMEWORKS DL-00001's long position.| SENECA FOODS-A vs. TOTAL GABON | SENECA FOODS-A vs. Walgreens Boots Alliance | SENECA FOODS-A vs. Peak Resources Limited |
| ZYMEWORKS DL-00001 vs. SENECA FOODS A | ZYMEWORKS DL-00001 vs. TYSON FOODS A | ZYMEWORKS DL-00001 vs. MHP Hotel AG | ZYMEWORKS DL-00001 vs. Performance Food Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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