Correlation Between Aytu BioScience and Ibio
Can any of the company-specific risk be diversified away by investing in both Aytu BioScience and Ibio 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 Aytu BioScience and Ibio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aytu BioScience and Ibio Inc, you can compare the effects of market volatilities on Aytu BioScience and Ibio 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 Aytu BioScience with a short position of Ibio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aytu BioScience and Ibio.
Diversification Opportunities for Aytu BioScience and Ibio
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aytu and Ibio is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Aytu BioScience and Ibio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ibio Inc and Aytu BioScience 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 Aytu BioScience are associated (or correlated) with Ibio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ibio Inc has no effect on the direction of Aytu BioScience i.e., Aytu BioScience and Ibio go up and down completely randomly.
Pair Corralation between Aytu BioScience and Ibio
Given the investment horizon of 90 days Aytu BioScience is expected to generate 0.38 times more return on investment than Ibio. However, Aytu BioScience is 2.6 times less risky than Ibio. It trades about 0.02 of its potential returns per unit of risk. Ibio Inc is currently generating about -0.01 per unit of risk. If you would invest 176.00 in Aytu BioScience on August 30, 2024 and sell it today you would lose (14.00) from holding Aytu BioScience or give up 7.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aytu BioScience vs. Ibio Inc
Performance |
| Timeline |
| Aytu BioScience |
| Ibio Inc |
Aytu BioScience and Ibio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aytu BioScience and Ibio
The main advantage of trading using opposite Aytu BioScience and Ibio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aytu BioScience position performs unexpectedly, Ibio 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 Ibio will offset losses from the drop in Ibio's long position.| Aytu BioScience vs. Aquestive Therapeutics | Aytu BioScience vs. Evoke Pharma | Aytu BioScience vs. Shionogi Co Ltd | Aytu BioScience vs. Sunshine Biopharma |
| Ibio vs. Jaguar Animal Health | Ibio vs. GeoVax Labs | Ibio vs. Ocugen Inc | Ibio vs. Tonix Pharmaceuticals Holding |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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