Correlation Between Biofrontera and City View
Can any of the company-specific risk be diversified away by investing in both Biofrontera and City View 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 City View into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biofrontera and City View Green, you can compare the effects of market volatilities on Biofrontera and City View 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 City View. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biofrontera and City View.
Diversification Opportunities for Biofrontera and City View
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Biofrontera and City is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Biofrontera and City View Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City View Green 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 City View. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City View Green has no effect on the direction of Biofrontera i.e., Biofrontera and City View go up and down completely randomly.
Pair Corralation between Biofrontera and City View
Given the investment horizon of 90 days Biofrontera is expected to generate 52.64 times less return on investment than City View. But when comparing it to its historical volatility, Biofrontera is 5.85 times less risky than City View. It trades about 0.03 of its potential returns per unit of risk. City View Green is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 0.26 in City View Green on October 25, 2024 and sell it today you would earn a total of 0.52 from holding City View Green or generate 200.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Biofrontera vs. City View Green
Performance |
| Timeline |
| Biofrontera |
| City View Green |
Biofrontera and City View Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biofrontera and City View
The main advantage of trading using opposite Biofrontera and City View positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biofrontera position performs unexpectedly, City View 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 City View will offset losses from the drop in City View's long position.| Biofrontera vs. Shuttle Pharmaceuticals | Biofrontera vs. Akanda Corp | Biofrontera vs. China Pharma Holdings | Biofrontera vs. Sunshine Biopharma Warrant |
| City View vs. Benchmark Botanics | City View vs. Speakeasy Cannabis Club | City View vs. BC Craft Supply | City View vs. Ravenquest Biomed |
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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