Correlation Between Biofrontera Warrants and Silence Therapeutics
Can any of the company-specific risk be diversified away by investing in both Biofrontera Warrants and Silence Therapeutics 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 Warrants and Silence Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biofrontera Warrants and Silence Therapeutics PLC, you can compare the effects of market volatilities on Biofrontera Warrants and Silence Therapeutics 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 Warrants with a short position of Silence Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biofrontera Warrants and Silence Therapeutics.
Diversification Opportunities for Biofrontera Warrants and Silence Therapeutics
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Biofrontera and Silence is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Biofrontera Warrants and Silence Therapeutics PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silence Therapeutics PLC and Biofrontera Warrants 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 Warrants are associated (or correlated) with Silence Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silence Therapeutics PLC has no effect on the direction of Biofrontera Warrants i.e., Biofrontera Warrants and Silence Therapeutics go up and down completely randomly.
Pair Corralation between Biofrontera Warrants and Silence Therapeutics
Assuming the 90 days horizon Biofrontera Warrants is expected to generate 40.34 times more return on investment than Silence Therapeutics. However, Biofrontera Warrants is 40.34 times more volatile than Silence Therapeutics PLC. It trades about 0.19 of its potential returns per unit of risk. Silence Therapeutics PLC is currently generating about -0.04 per unit of risk. If you would invest 2.21 in Biofrontera Warrants on September 2, 2024 and sell it today you would earn a total of 10.79 from holding Biofrontera Warrants or generate 488.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 62.5% |
| Values | Daily Returns |
Biofrontera Warrants vs. Silence Therapeutics PLC
Performance |
| Timeline |
| Biofrontera Warrants |
| Silence Therapeutics PLC |
Biofrontera Warrants and Silence Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biofrontera Warrants and Silence Therapeutics
The main advantage of trading using opposite Biofrontera Warrants and Silence Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biofrontera Warrants position performs unexpectedly, Silence Therapeutics 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 Silence Therapeutics will offset losses from the drop in Silence Therapeutics' long position.| Biofrontera Warrants vs. Biofrontera | Biofrontera Warrants vs. Pasithea Therapeutics Corp | Biofrontera Warrants vs. Inspira Technologies Oxy | Biofrontera Warrants vs. Bluejay Diagnostics |
| Silence Therapeutics vs. Tff Pharmaceuticals | Silence Therapeutics vs. Eliem Therapeutics | Silence Therapeutics vs. Inhibrx | Silence Therapeutics vs. Enliven Therapeutics |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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