Correlation Between China Solar and Vir Biotechnology
Can any of the company-specific risk be diversified away by investing in both China Solar and Vir Biotechnology 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 China Solar and Vir Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Solar Cln and Vir Biotechnology, you can compare the effects of market volatilities on China Solar and Vir Biotechnology 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 China Solar with a short position of Vir Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Solar and Vir Biotechnology.
Diversification Opportunities for China Solar and Vir Biotechnology
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between China and Vir is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding China Solar Cln and Vir Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vir Biotechnology and China Solar 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 China Solar Cln are associated (or correlated) with Vir Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vir Biotechnology has no effect on the direction of China Solar i.e., China Solar and Vir Biotechnology go up and down completely randomly.
Pair Corralation between China Solar and Vir Biotechnology
Given the investment horizon of 90 days China Solar Cln is expected to generate 4.08 times more return on investment than Vir Biotechnology. However, China Solar is 4.08 times more volatile than Vir Biotechnology. It trades about 0.19 of its potential returns per unit of risk. Vir Biotechnology is currently generating about 0.1 per unit of risk. If you would invest 0.99 in China Solar Cln on September 7, 2025 and sell it today you would earn a total of 2.01 from holding China Solar Cln or generate 203.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
China Solar Cln vs. Vir Biotechnology
Performance |
| Timeline |
| China Solar Cln |
| Vir Biotechnology |
China Solar and Vir Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Solar and Vir Biotechnology
The main advantage of trading using opposite China Solar and Vir Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Solar position performs unexpectedly, Vir Biotechnology 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 Vir Biotechnology will offset losses from the drop in Vir Biotechnology's long position.| China Solar vs. Delaware Investments Florida | China Solar vs. Tencent Music Entertainment | China Solar vs. Atrium Mortgage Investment | China Solar vs. Cleanaway Waste Management |
| Vir Biotechnology vs. Nok Airlines Public | Vir Biotechnology vs. Rexford Industrial Realty | Vir Biotechnology vs. Federal Home Loan | Vir Biotechnology vs. Barrick Mining |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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