Correlation Between Bone Biologics and Biofrontera Warrants
Can any of the company-specific risk be diversified away by investing in both Bone Biologics and Biofrontera Warrants 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 Bone Biologics and Biofrontera Warrants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bone Biologics Corp and Biofrontera Warrants, you can compare the effects of market volatilities on Bone Biologics and Biofrontera Warrants 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 Bone Biologics with a short position of Biofrontera Warrants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bone Biologics and Biofrontera Warrants.
Diversification Opportunities for Bone Biologics and Biofrontera Warrants
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bone and Biofrontera is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Bone Biologics Corp and Biofrontera Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biofrontera Warrants and Bone 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 Bone Biologics Corp are associated (or correlated) with Biofrontera Warrants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biofrontera Warrants has no effect on the direction of Bone Biologics i.e., Bone Biologics and Biofrontera Warrants go up and down completely randomly.
Pair Corralation between Bone Biologics and Biofrontera Warrants
Given the investment horizon of 90 days Bone Biologics Corp is expected to under-perform the Biofrontera Warrants. But the stock apears to be less risky and, when comparing its historical volatility, Bone Biologics Corp is 14.19 times less risky than Biofrontera Warrants. The stock trades about -0.19 of its potential returns per unit of risk. The Biofrontera Warrants is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Biofrontera Warrants on August 25, 2024 and sell it today you would earn a total of 3.39 from holding Biofrontera Warrants or generate 113.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Bone Biologics Corp vs. Biofrontera Warrants
Performance |
| Timeline |
| Bone Biologics Corp |
| Biofrontera Warrants |
Bone Biologics and Biofrontera Warrants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bone Biologics and Biofrontera Warrants
The main advantage of trading using opposite Bone Biologics and Biofrontera Warrants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bone Biologics position performs unexpectedly, Biofrontera Warrants 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 Biofrontera Warrants will offset losses from the drop in Biofrontera Warrants' long position.| Bone Biologics vs. Neuropace | Bone Biologics vs. Inogen Inc | Bone Biologics vs. SurModics | Bone Biologics vs. Pulmonx Corp |
| Biofrontera Warrants vs. Biofrontera | Biofrontera Warrants vs. Pasithea Therapeutics Corp | Biofrontera Warrants vs. Inspira Technologies Oxy | Biofrontera Warrants vs. Bluejay Diagnostics |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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