Correlation Between Bavarian Nordic and Cyxone AB
Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and Cyxone AB 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 Bavarian Nordic and Cyxone AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bavarian Nordic and Cyxone AB, you can compare the effects of market volatilities on Bavarian Nordic and Cyxone AB 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 Bavarian Nordic with a short position of Cyxone AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and Cyxone AB.
Diversification Opportunities for Bavarian Nordic and Cyxone AB
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bavarian and Cyxone is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and Cyxone AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cyxone AB and Bavarian Nordic 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 Bavarian Nordic are associated (or correlated) with Cyxone AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cyxone AB has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and Cyxone AB go up and down completely randomly.
Pair Corralation between Bavarian Nordic and Cyxone AB
Assuming the 90 days trading horizon Bavarian Nordic is expected to generate 0.44 times more return on investment than Cyxone AB. However, Bavarian Nordic is 2.28 times less risky than Cyxone AB. It trades about 0.01 of its potential returns per unit of risk. Cyxone AB is currently generating about -0.04 per unit of risk. If you would invest 23,560 in Bavarian Nordic on August 26, 2024 and sell it today you would lose (3,720) from holding Bavarian Nordic or give up 15.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Bavarian Nordic vs. Cyxone AB
Performance |
| Timeline |
| Bavarian Nordic |
| Cyxone AB |
Bavarian Nordic and Cyxone AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bavarian Nordic and Cyxone AB
The main advantage of trading using opposite Bavarian Nordic and Cyxone AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, Cyxone AB 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 Cyxone AB will offset losses from the drop in Cyxone AB's long position.| Bavarian Nordic vs. Ambu AS | Bavarian Nordic vs. Danske Bank AS | Bavarian Nordic vs. Genmab AS | Bavarian Nordic vs. DSV Panalpina AS |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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