New Focus Auto Stock Volatility
We consider New Focus out of control. New Focus Auto has Sharpe Ratio of 0.024, which conveys that the firm had a 0.024% return per unit of risk over the last 3 months. We have found thirteen technical indicators for New Focus, which you can use to evaluate the volatility of the firm. Please verify New Focus' Standard Deviation of 5.24, mean deviation of 1.08, and Risk Adjusted Performance of 0.0237 to check out if the risk estimate we provide is consistent with the expected return of 0.13%.
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New Focus Pink Sheet volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of New daily returns, and it is calculated using variance and standard deviation. We also use New's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of New Focus volatility.
New Focus Auto Pink Sheet Volatility Analysis
Volatility refers to the frequency at which New Focus pink sheet price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with New Focus' price changes. Investors will then calculate the volatility of New Focus' pink sheet to predict their future moves. A pink sheet that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A pink sheet with relatively stable price changes has low volatility. A highly volatile pink sheet is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of New Focus' volatility:
Historical Volatility
This type of pink sheet volatility measures New Focus' fluctuations based on previous trends. It's commonly used to predict New Focus' future behavior based on its past. However, it cannot conclusively determine the future direction of the pink sheet.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for New Focus' current market price. This means that the pink sheet will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on New Focus' to be redeemed at a future date.Transformation |
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New Focus Projected Return Density Against Market
Assuming the 90 days horizon New Focus has a beta of 0.9441 . This indicates New Focus Auto market returns are reactive to returns on the market. As the market goes up or down, New Focus is expected to follow.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to New Focus or New sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that New Focus' price will be affected by overall pink sheet market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a New pink sheet's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
New Focus Auto has an alpha of 0.0604, implying that it can generate a 0.0604 percent excess return over NYSE Composite after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a New Focus Price Volatility?
Several factors can influence a pink sheet's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.New Focus Pink Sheet Risk Measures
Assuming the 90 days horizon the coefficient of variation of New Focus is 4163.81. The daily returns are distributed with a variance of 27.41 and standard deviation of 5.24. The mean deviation of New Focus Auto is currently at 1.08. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.62
α | Alpha over NYSE Composite | 0.06 | |
β | Beta against NYSE Composite | 0.94 | |
σ | Overall volatility | 5.24 | |
Ir | Information ratio | 0.01 |
New Focus Pink Sheet Return Volatility
New Focus historical daily return volatility represents how much of New Focus pink sheet's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company shows 5.2352% volatility of returns over 90 . By contrast, NYSE Composite accepts 0.6214% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About New Focus Volatility
Volatility is a rate at which the price of New Focus or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of New Focus may increase or decrease. In other words, similar to New's beta indicator, it measures the risk of New Focus and helps estimate the fluctuations that may happen in a short period of time. So if prices of New Focus fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.New Focus Auto Tech Holdings Limited, an investment holding company, engages in the manufacture and sale of electronic and power-related automotive parts and accessories. New Focus Auto Tech Holdings Limited was incorporated in 2002 and is headquartered in Shanghai, the Peoples Republic of China. New Focus operates under Auto Parts classification in the United States and is traded on OTC Exchange. It employs 889 people.
New Focus' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on New Pink Sheet over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much New Focus' price varies over time.
3 ways to utilize New Focus' volatility to invest better
Higher New Focus' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of New Focus Auto stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. New Focus Auto stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of New Focus Auto investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in New Focus' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of New Focus' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
New Focus Investment Opportunity
New Focus Auto has a volatility of 5.24 and is 8.45 times more volatile than NYSE Composite. Compared to the overall equity markets, volatility of historical daily returns of New Focus Auto is lower than 46 percent of all global equities and portfolios over the last 90 days. You can use New Focus Auto to protect your portfolios against small market fluctuations. The pink sheet experiences a normal downward fluctuation but is a risky buy. Check odds of New Focus to be traded at $0.0238 in 90 days.Significant diversification
The correlation between New Focus Auto and NYA is 0.08 (i.e., Significant diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding New Focus Auto and NYA in the same portfolio, assuming nothing else is changed.
New Focus Additional Risk Indicators
The analysis of New Focus' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in New Focus' investment and either accepting that risk or mitigating it. Along with some common measures of New Focus pink sheet's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0237 | |||
| Market Risk Adjusted Performance | 0.1326 | |||
| Mean Deviation | 1.08 | |||
| Coefficient Of Variation | 4163.81 | |||
| Standard Deviation | 5.24 | |||
| Variance | 27.41 | |||
| Information Ratio | 0.0109 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential pink sheets, we recommend comparing similar pink sheets with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
New Focus Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against New Focus as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. New Focus' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, New Focus' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to New Focus Auto.
Check out Correlation Analysis to better understand how to build diversified portfolios, which includes a position in New Focus Auto. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in nation. Note that the New Focus Auto information on this page should be used as a complementary analysis to other New Focus' statistical models used 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.
Complementary Tools for New Pink Sheet analysis
When running New Focus' price analysis, check to measure New Focus' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy New Focus is operating at the current time. Most of New Focus' value examination focuses on studying past and present price action to predict the probability of New Focus' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move New Focus' price. Additionally, you may evaluate how the addition of New Focus to your portfolios can decrease your overall portfolio volatility.
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