Correlation Between WuXi Biologics and CSL
Can any of the company-specific risk be diversified away by investing in both WuXi Biologics and CSL 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 WuXi Biologics and CSL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WuXi Biologics and CSL Limited, you can compare the effects of market volatilities on WuXi Biologics and CSL 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 WuXi Biologics with a short position of CSL. Check out your portfolio center. Please also check ongoing floating volatility patterns of WuXi Biologics and CSL.
Diversification Opportunities for WuXi Biologics and CSL
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WuXi and CSL is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding WuXi Biologics and CSL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSL Limited and WuXi Biologics 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 WuXi Biologics are associated (or correlated) with CSL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSL Limited has no effect on the direction of WuXi Biologics i.e., WuXi Biologics and CSL go up and down completely randomly.
Pair Corralation between WuXi Biologics and CSL
Assuming the 90 days horizon WuXi Biologics is expected to under-perform the CSL. In addition to that, WuXi Biologics is 2.0 times more volatile than CSL Limited. It trades about -0.04 of its total potential returns per unit of risk. CSL Limited is currently generating about 0.01 per unit of volatility. If you would invest 18,311 in CSL Limited on January 24, 2024 and sell it today you would lose (711.00) from holding CSL Limited or give up 3.88% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 96.97% |
Values | Daily Returns |
WuXi Biologics vs. CSL Limited
Performance |
Timeline |
WuXi Biologics |
CSL Limited |
WuXi Biologics and CSL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WuXi Biologics and CSL
The main advantage of trading using opposite WuXi Biologics and CSL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WuXi Biologics position performs unexpectedly, CSL 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 CSL will offset losses from the drop in CSL's long position.WuXi Biologics vs. Marizyme | WuXi Biologics vs. Edgewise Therapeutics | WuXi Biologics vs. Keros TherapeuticsInc | WuXi Biologics vs. Monte Rosa Therapeutics |
CSL vs. Pmv PharmaceuticalsInc | CSL vs. Novo Nordisk AS | CSL vs. Kalvista Pharmaceuticals | CSL vs. ProKidney Corp |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |