Correlation Between Genovate Biotechnology and WPG Holdings

Can any of the company-specific risk be diversified away by investing in both Genovate Biotechnology and WPG Holdings 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 WPG Holdings 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 WPG Holdings, you can compare the effects of market volatilities on Genovate Biotechnology and WPG Holdings 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 WPG Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genovate Biotechnology and WPG Holdings.

Diversification Opportunities for Genovate Biotechnology and WPG Holdings

0.0

Correlation Coefficient

Genovate Biotechnology  WPG Holdings

Pay attention - limited upside

The 3 months correlation between Genovate and WPG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Genovate Biotechnology Co and WPG Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WPG Holdings 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 WPG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WPG Holdings has no effect on the direction of Genovate Biotechnology i.e., Genovate Biotechnology and WPG Holdings go up and down completely randomly.

Pair Corralation between Genovate Biotechnology and WPG Holdings

If you would invest  2,070  in Genovate Biotechnology Co on December 22, 2024 and sell it today you would earn a total of  245.00  from holding Genovate Biotechnology Co or generate 11.84% return on investment over 90 days.

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

Genovate Biotechnology Co  vs.  WPG Holdings

Genovate Biotechnology

Risk-Adjusted Performance

OK

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

WPG Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days WPG Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, WPG Holdings is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Genovate Biotechnology and WPG Holdings

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

The idea behind Genovate Biotechnology Co and WPG Holdings 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.