Correlation Between Agilent Technologies and Bio Techne
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Bio Techne 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 Agilent Technologies and Bio Techne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Bio Techne Corp, you can compare the effects of market volatilities on Agilent Technologies and Bio Techne 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 Agilent Technologies with a short position of Bio Techne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Bio Techne.
Diversification Opportunities for Agilent Technologies and Bio Techne
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Agilent and Bio is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Bio Techne Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Techne Corp and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Bio Techne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Techne Corp has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Bio Techne go up and down completely randomly.
Pair Corralation between Agilent Technologies and Bio Techne
Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 0.75 times more return on investment than Bio Techne. However, Agilent Technologies is 1.33 times less risky than Bio Techne. It trades about 0.12 of its potential returns per unit of risk. Bio Techne Corp is currently generating about 0.0 per unit of risk. If you would invest 13,149 in Agilent Technologies on August 31, 2024 and sell it today you would earn a total of 665.00 from holding Agilent Technologies or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Bio Techne Corp
Performance |
| Timeline |
| Agilent Technologies |
| Bio Techne Corp |
Agilent Technologies and Bio Techne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Bio Techne
The main advantage of trading using opposite Agilent Technologies and Bio Techne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Bio Techne 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 Bio Techne will offset losses from the drop in Bio Techne's long position.| Agilent Technologies vs. IDEXX Laboratories | Agilent Technologies vs. IQVIA Holdings | Agilent Technologies vs. Charles River Laboratories | Agilent Technologies vs. Revvity |
| Bio Techne vs. Biomarin Pharmaceutical | Bio Techne vs. Vaxcyte | Bio Techne vs. Liquidia Technologies | Bio Techne vs. Legend Biotech 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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