Correlation Between BioInvent International and BE Group
Can any of the company-specific risk be diversified away by investing in both BioInvent International and BE Group 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 BioInvent International and BE Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioInvent International AB and BE Group AB, you can compare the effects of market volatilities on BioInvent International and BE Group 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 BioInvent International with a short position of BE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioInvent International and BE Group.
Diversification Opportunities for BioInvent International and BE Group
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BioInvent and BEGR is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding BioInvent International AB and BE Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BE Group AB and BioInvent International 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 BioInvent International AB are associated (or correlated) with BE Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BE Group AB has no effect on the direction of BioInvent International i.e., BioInvent International and BE Group go up and down completely randomly.
Pair Corralation between BioInvent International and BE Group
Assuming the 90 days trading horizon BioInvent International AB is expected to generate 2.49 times more return on investment than BE Group. However, BioInvent International is 2.49 times more volatile than BE Group AB. It trades about -0.03 of its potential returns per unit of risk. BE Group AB is currently generating about -0.31 per unit of risk. If you would invest 4,600 in BioInvent International AB on August 29, 2024 and sell it today you would lose (140.00) from holding BioInvent International AB or give up 3.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BioInvent International AB vs. BE Group AB
Performance |
| Timeline |
| BioInvent International |
| BE Group AB |
BioInvent International and BE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioInvent International and BE Group
The main advantage of trading using opposite BioInvent International and BE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioInvent International position performs unexpectedly, BE Group 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 BE Group will offset losses from the drop in BE Group's long position.| BioInvent International vs. Hansa Biopharma AB | BioInvent International vs. Saniona AB | BioInvent International vs. Active Biotech AB | BioInvent International vs. Oncopeptides AB |
| BE Group vs. Addtech AB | BE Group vs. Teqnion AB | BE Group vs. Vitec Software Group | BE Group vs. Lagercrantz Group AB |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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