Correlation Between Biofrontera and Allied Corp
Can any of the company-specific risk be diversified away by investing in both Biofrontera and Allied Corp 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 Biofrontera and Allied Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biofrontera and Allied Corp, you can compare the effects of market volatilities on Biofrontera and Allied Corp 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 Biofrontera with a short position of Allied Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biofrontera and Allied Corp.
Diversification Opportunities for Biofrontera and Allied Corp
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Biofrontera and Allied is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Biofrontera and Allied Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allied Corp and Biofrontera 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 Biofrontera are associated (or correlated) with Allied Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allied Corp has no effect on the direction of Biofrontera i.e., Biofrontera and Allied Corp go up and down completely randomly.
Pair Corralation between Biofrontera and Allied Corp
Given the investment horizon of 90 days Biofrontera is expected to generate 2.81 times less return on investment than Allied Corp. But when comparing it to its historical volatility, Biofrontera is 2.71 times less risky than Allied Corp. It trades about 0.03 of its potential returns per unit of risk. Allied Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Allied Corp on August 29, 2024 and sell it today you would lose (11.97) from holding Allied Corp or give up 79.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biofrontera vs. Allied Corp
Performance |
| Timeline |
| Biofrontera |
| Allied Corp |
Biofrontera and Allied Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biofrontera and Allied Corp
The main advantage of trading using opposite Biofrontera and Allied Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biofrontera position performs unexpectedly, Allied Corp 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 Allied Corp will offset losses from the drop in Allied Corp's long position.| Biofrontera vs. Shuttle Pharmaceuticals | Biofrontera vs. Akanda Corp | Biofrontera vs. China Pharma Holdings | Biofrontera vs. Sunshine Biopharma Warrant |
| Allied Corp vs. The BC Bud | Allied Corp vs. Amexdrug | Allied Corp vs. Aion Therapeutic | Allied Corp vs. Antisense Therapeutics Limited |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |