Correlation Between Biogen and Lixte Biotechnology
Can any of the company-specific risk be diversified away by investing in both Biogen and Lixte Biotechnology 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 Biogen and Lixte Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biogen Inc and Lixte Biotechnology Holdings, you can compare the effects of market volatilities on Biogen and Lixte Biotechnology 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 Biogen with a short position of Lixte Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biogen and Lixte Biotechnology.
Diversification Opportunities for Biogen and Lixte Biotechnology
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Biogen and Lixte is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Biogen Inc and Lixte Biotechnology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lixte Biotechnology and Biogen 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 Biogen Inc are associated (or correlated) with Lixte Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lixte Biotechnology has no effect on the direction of Biogen i.e., Biogen and Lixte Biotechnology go up and down completely randomly.
Pair Corralation between Biogen and Lixte Biotechnology
Given the investment horizon of 90 days Biogen Inc is expected to under-perform the Lixte Biotechnology. But the stock apears to be less risky and, when comparing its historical volatility, Biogen Inc is 2.52 times less risky than Lixte Biotechnology. The stock trades about -0.12 of its potential returns per unit of risk. The Lixte Biotechnology Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 222.00 in Lixte Biotechnology Holdings on November 3, 2024 and sell it today you would earn a total of 26.00 from holding Lixte Biotechnology Holdings or generate 11.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biogen Inc vs. Lixte Biotechnology Holdings
Performance |
| Timeline |
| Biogen Inc |
| Lixte Biotechnology |
Biogen and Lixte Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biogen and Lixte Biotechnology
The main advantage of trading using opposite Biogen and Lixte Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biogen position performs unexpectedly, Lixte Biotechnology 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 Lixte Biotechnology will offset losses from the drop in Lixte Biotechnology's long position.| Biogen vs. Bristol Myers Squibb | Biogen vs. AbbVie Inc | Biogen vs. Merck Company | Biogen vs. Gilead Sciences |
| Lixte Biotechnology vs. Allarity Therapeutics | Lixte Biotechnology vs. Virax Biolabs Group | Lixte Biotechnology vs. Quoin Pharmaceuticals Ltd | Lixte Biotechnology vs. Indaptus 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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