Correlation Between Medigen Biotechnology and Data International

Can any of the company-specific risk be diversified away by investing in both Medigen Biotechnology and Data International 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 Medigen Biotechnology and Data International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Medigen Biotechnology and Data International Co, you can compare the effects of market volatilities on Medigen Biotechnology and Data International 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 Medigen Biotechnology with a short position of Data International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medigen Biotechnology and Data International.

Diversification Opportunities for Medigen Biotechnology and Data International

0.12

Correlation Coefficient

Medigen Biotechnology  Data International

Average diversification

The 3 months correlation between Medigen and Data is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Medigen Biotechnology and Data International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data International and Medigen Biotechnology 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 Medigen Biotechnology are associated (or correlated) with Data International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data International has no effect on the direction of Medigen Biotechnology i.e., Medigen Biotechnology and Data International go up and down completely randomly.

Pair Corralation between Medigen Biotechnology and Data International

Assuming the 90 days trading horizon Medigen Biotechnology is expected to generate 0.59 times more return on investment than Data International. However, Medigen Biotechnology is 1.7 times less risky than Data International. It trades about 0.1 of its potential returns per unit of risk. Data International Co is currently generating about -0.02 per unit of risk. If you would invest  3,180  in Medigen Biotechnology on December 22, 2024 and sell it today you would earn a total of  370.00  from holding Medigen Biotechnology or generate 11.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.25%
Values	Daily Returns

Medigen Biotechnology  vs.  Data International Co

Medigen Biotechnology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Medigen Biotechnology are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Medigen Biotechnology showed solid returns over the last few months and may actually be approaching a breakup point.

Data International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Data International Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Data International is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Medigen Biotechnology and Data International

The main advantage of trading using opposite Medigen Biotechnology and Data International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medigen Biotechnology position performs unexpectedly, Data International 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 Data International will offset losses from the drop in Data International's long position.

The idea behind Medigen Biotechnology and Data International Co 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.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.