Correlation Between Genovate Biotechnology and New Advanced

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

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

Diversification Opportunities for Genovate Biotechnology and New Advanced

0.77

Correlation Coefficient

Genovate Biotechnology  New Advanced

Poor diversification

The 3 months correlation between Genovate and New is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Genovate Biotechnology Co and New Advanced Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Advanced Electronics and Genovate 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 Genovate Biotechnology Co are associated (or correlated) with New Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Advanced Electronics has no effect on the direction of Genovate Biotechnology i.e., Genovate Biotechnology and New Advanced go up and down completely randomly.

Pair Corralation between Genovate Biotechnology and New Advanced

Assuming the 90 days trading horizon Genovate Biotechnology is expected to generate 1.82 times less return on investment than New Advanced. But when comparing it to its historical volatility, Genovate Biotechnology Co is 1.04 times less risky than New Advanced. It trades about 0.04 of its potential returns per unit of risk. New Advanced Electronics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  5,330  in New Advanced Electronics on December 30, 2024 and sell it today you would earn a total of  430.00  from holding New Advanced Electronics or generate 8.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Genovate Biotechnology Co  vs.  New Advanced Electronics

Genovate Biotechnology

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Genovate Biotechnology Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Genovate Biotechnology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

New Advanced Electronics

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in New Advanced Electronics are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, New Advanced may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Genovate Biotechnology and New Advanced

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

The idea behind Genovate Biotechnology Co and New Advanced Electronics 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.