Correlation Between SPECTRAL MEDICAL and CanSino Biologics
Can any of the company-specific risk be diversified away by investing in both SPECTRAL MEDICAL and CanSino Biologics 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 SPECTRAL MEDICAL and CanSino Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPECTRAL MEDICAL and CanSino Biologics, you can compare the effects of market volatilities on SPECTRAL MEDICAL and CanSino Biologics 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 SPECTRAL MEDICAL with a short position of CanSino Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPECTRAL MEDICAL and CanSino Biologics.
Diversification Opportunities for SPECTRAL MEDICAL and CanSino Biologics
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SPECTRAL and CanSino is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding SPECTRAL MEDICAL and CanSino Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanSino Biologics and SPECTRAL MEDICAL 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 SPECTRAL MEDICAL are associated (or correlated) with CanSino Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanSino Biologics has no effect on the direction of SPECTRAL MEDICAL i.e., SPECTRAL MEDICAL and CanSino Biologics go up and down completely randomly.
Pair Corralation between SPECTRAL MEDICAL and CanSino Biologics
Assuming the 90 days horizon SPECTRAL MEDICAL is expected to generate 0.96 times more return on investment than CanSino Biologics. However, SPECTRAL MEDICAL is 1.04 times less risky than CanSino Biologics. It trades about 0.06 of its potential returns per unit of risk. CanSino Biologics is currently generating about -0.04 per unit of risk. If you would invest 32.00 in SPECTRAL MEDICAL on October 27, 2024 and sell it today you would earn a total of 1.00 from holding SPECTRAL MEDICAL or generate 3.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SPECTRAL MEDICAL vs. CanSino Biologics
Performance |
Timeline |
SPECTRAL MEDICAL |
CanSino Biologics |
SPECTRAL MEDICAL and CanSino Biologics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SPECTRAL MEDICAL and CanSino Biologics
The main advantage of trading using opposite SPECTRAL MEDICAL and CanSino Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPECTRAL MEDICAL position performs unexpectedly, CanSino Biologics 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 CanSino Biologics will offset losses from the drop in CanSino Biologics' long position.SPECTRAL MEDICAL vs. BANKINTER ADR 2007 | ||
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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