Correlation Between Gemina Laboratories and Zhejiang Expressway

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

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

Diversification Opportunities for Gemina Laboratories and Zhejiang Expressway

0.0

Correlation Coefficient

Gemina Laboratories  Zhejiang Expressway

Pay attention - limited upside

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

Pair Corralation between Gemina Laboratories and Zhejiang Expressway

If you would invest  37.00  in Gemina Laboratories on December 21, 2024 and sell it today you would earn a total of  55.00  from holding Gemina Laboratories or generate 148.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Gemina Laboratories  vs.  Zhejiang Expressway Co

Gemina Laboratories

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Gemina Laboratories are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak fundamental drivers, Gemina Laboratories reported solid returns over the last few months and may actually be approaching a breakup point.

Zhejiang Expressway

Risk-Adjusted Performance

Very Weak

Over the last 90 days Zhejiang Expressway Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Zhejiang Expressway is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Gemina Laboratories and Zhejiang Expressway

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

The idea behind Gemina Laboratories and Zhejiang Expressway 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.