Correlation Between Biomerieux and Socit BIC
Can any of the company-specific risk be diversified away by investing in both Biomerieux and Socit BIC 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 Biomerieux and Socit BIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biomerieux SA and Socit BIC SA, you can compare the effects of market volatilities on Biomerieux and Socit BIC 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 Biomerieux with a short position of Socit BIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biomerieux and Socit BIC.
Diversification Opportunities for Biomerieux and Socit BIC
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Biomerieux and Socit is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Biomerieux SA and Socit BIC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit BIC SA and Biomerieux 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 Biomerieux SA are associated (or correlated) with Socit BIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit BIC SA has no effect on the direction of Biomerieux i.e., Biomerieux and Socit BIC go up and down completely randomly.
Pair Corralation between Biomerieux and Socit BIC
Assuming the 90 days trading horizon Biomerieux SA is expected to generate 0.71 times more return on investment than Socit BIC. However, Biomerieux SA is 1.41 times less risky than Socit BIC. It trades about 0.03 of its potential returns per unit of risk. Socit BIC SA is currently generating about 0.0 per unit of risk. If you would invest 9,549 in Biomerieux SA on September 1, 2024 and sell it today you would earn a total of 336.00 from holding Biomerieux SA or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biomerieux SA vs. Socit BIC SA
Performance |
| Timeline |
| Biomerieux SA |
| Socit BIC SA |
Biomerieux and Socit BIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biomerieux and Socit BIC
The main advantage of trading using opposite Biomerieux and Socit BIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biomerieux position performs unexpectedly, Socit BIC 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 Socit BIC will offset losses from the drop in Socit BIC's long position.| Biomerieux vs. Sartorius Stedim Biotech | Biomerieux vs. Eurofins Scientific SE | Biomerieux vs. Ipsen SA | Biomerieux vs. Edenred SA |
| Socit BIC vs. LVMH Mot Hennessy | Socit BIC vs. Danone SA | Socit BIC vs. Air Liquide SA | Socit BIC vs. Hermes International SCA |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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