Correlation Between BeiGene and Guangxi Wuzhou

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

By analyzing existing cross correlation between BeiGene and Guangxi Wuzhou Communications, you can compare the effects of market volatilities on BeiGene and Guangxi Wuzhou 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 BeiGene with a short position of Guangxi Wuzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of BeiGene and Guangxi Wuzhou.

Diversification Opportunities for BeiGene and Guangxi Wuzhou

0.0

Correlation Coefficient

BeiGene  Guangxi Wuzhou

Pay attention - limited upside

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

Pair Corralation between BeiGene and Guangxi Wuzhou

If you would invest  0.00  in BeiGene on December 27, 2024 and sell it today you would earn a total of  0.00  from holding BeiGene or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.75%
Values	Daily Returns

BeiGene  vs.  Guangxi Wuzhou Communications

BeiGene

Risk-Adjusted Performance

Solid

Over the last 90 days BeiGene has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, BeiGene is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Guangxi Wuzhou Commu

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guangxi Wuzhou Communications has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with BeiGene and Guangxi Wuzhou

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

The idea behind BeiGene and Guangxi Wuzhou Communications 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.