Correlation Between Genovate Biotechnology and Symtek Automation

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

Diversification Opportunities for Genovate Biotechnology and Symtek Automation

-0.06
  Correlation Coefficient

Good diversification

The 3 months correlation between Genovate and Symtek is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Genovate Biotechnology Co and Symtek Automation Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symtek Automation Asia 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 Symtek Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symtek Automation Asia has no effect on the direction of Genovate Biotechnology i.e., Genovate Biotechnology and Symtek Automation go up and down completely randomly.

Pair Corralation between Genovate Biotechnology and Symtek Automation

Assuming the 90 days trading horizon Genovate Biotechnology Co is expected to under-perform the Symtek Automation. But the stock apears to be less risky and, when comparing its historical volatility, Genovate Biotechnology Co is 4.67 times less risky than Symtek Automation. The stock trades about -0.02 of its potential returns per unit of risk. The Symtek Automation Asia is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  11,850  in Symtek Automation Asia on September 6, 2024 and sell it today you would earn a total of  9,050  from holding Symtek Automation Asia or generate 76.37% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.41%
ValuesDaily Returns

Genovate Biotechnology Co  vs.  Symtek Automation Asia

 Performance 
       Timeline  
Genovate Biotechnology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Genovate Biotechnology Co has generated negative risk-adjusted returns adding no value to investors with long positions. 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.
Symtek Automation Asia 

Risk-Adjusted Performance

20 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Symtek Automation Asia are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Symtek Automation showed solid returns over the last few months and may actually be approaching a breakup point.

Genovate Biotechnology and Symtek Automation Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Genovate Biotechnology and Symtek Automation

The main advantage of trading using opposite Genovate Biotechnology and Symtek Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genovate Biotechnology position performs unexpectedly, Symtek Automation 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 Symtek Automation will offset losses from the drop in Symtek Automation's long position.
The idea behind Genovate Biotechnology Co and Symtek Automation Asia 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

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