Correlation Between BioInvent International and Egetis Therapeutics
Can any of the company-specific risk be diversified away by investing in both BioInvent International and Egetis 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 BioInvent International and Egetis Therapeutics 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 Egetis Therapeutics AB, you can compare the effects of market volatilities on BioInvent International and Egetis 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 BioInvent International with a short position of Egetis Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioInvent International and Egetis Therapeutics.
Diversification Opportunities for BioInvent International and Egetis Therapeutics
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BioInvent and Egetis is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding BioInvent International AB and Egetis Therapeutics AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Egetis Therapeutics 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 Egetis Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Egetis Therapeutics has no effect on the direction of BioInvent International i.e., BioInvent International and Egetis Therapeutics go up and down completely randomly.
Pair Corralation between BioInvent International and Egetis Therapeutics
Assuming the 90 days trading horizon BioInvent International AB is expected to generate 1.15 times more return on investment than Egetis Therapeutics. However, BioInvent International is 1.15 times more volatile than Egetis Therapeutics AB. It trades about -0.02 of its potential returns per unit of risk. Egetis Therapeutics AB is currently generating about -0.41 per unit of risk. If you would invest 2,735 in BioInvent International AB on December 4, 2024 and sell it today you would lose (55.00) from holding BioInvent International AB or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
BioInvent International AB vs. Egetis Therapeutics AB
Performance |
| Timeline |
| BioInvent International |
| Egetis Therapeutics |
BioInvent International and Egetis Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioInvent International and Egetis Therapeutics
The main advantage of trading using opposite BioInvent International and Egetis Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioInvent International position performs unexpectedly, Egetis 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 Egetis Therapeutics will offset losses from the drop in Egetis Therapeutics' long position.| BioInvent International vs. Hansa Biopharma AB | ||
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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